Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Jan. 31, 2015 | Jun. 28, 2014 | |
Document and Entity Information | |||
Entity Registrant Name | Avery Dennison Corp | ||
Entity Central Index Key | 8818 | ||
Document Type | 10-K | ||
Document Period End Date | 3-Jan-15 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -2 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $4,822,071,471 | ||
Entity Common Stock, Shares Outstanding | 90,494,421 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $227 | $351.60 |
Trade accounts receivable, less allowances of $30.5 and $31.6 at year-end 2014 and 2013, respectively | 958.1 | 1,016.50 |
Inventories, net | 491.8 | 494.1 |
Current deferred and refundable income taxes | 107.5 | 103.4 |
Assets held for sale | 0.8 | 1.3 |
Other current assets | 136.1 | 124.9 |
Total current assets | 1,921.30 | 2,091.80 |
Property, plant and equipment, net | 875.3 | 922.5 |
Goodwill | 721.6 | 751.1 |
Other intangibles resulting from business acquisitions, net | 67.4 | 96 |
Non-current deferred income taxes | 311 | 263.4 |
Other assets | 463.6 | 485.8 |
Total assets | 4,360.20 | 4,610.60 |
Current liabilities: | ||
Short-term borrowings and current portion of long-term debt and capital leases | 204.3 | 76.9 |
Accounts payable | 797.8 | 889.5 |
Accrued payroll and employee benefits | 173.7 | 224.1 |
Accrued trade rebates | 90.5 | 79.6 |
Current deferred and payable income taxes | 64.9 | 49.3 |
Other accrued liabilities | 266.6 | 234.7 |
Total current liabilities | 1,597.80 | 1,554.10 |
Long-term debt and capital leases | 945.3 | 950.6 |
Long-term retirement benefits and other liabilities | 622.8 | 476.4 |
Non-current deferred and payable income taxes | 127.8 | 137.3 |
Commitments and contingencies (see Notes 7 and 8) | ||
Shareholders' equity: | ||
Common stock, $1 par value per share, authorized - 400,000,000 shares at year-end 2014 and 2013; issued - 124,126,624 shares at year-end 2014 and 2013; outstanding - 90,458,956 shares and 96,178,411 shares at year-end 2014 and 2013, respectively | 124.1 | 124.1 |
Capital in excess of par value | 823.9 | 812.3 |
Retained earnings | 2,137.10 | 2,009.10 |
Treasury stock at cost, 33,667,668 shares and 27,948,213 shares at year-end 2014 and 2013, respectively | -1,471.30 | -1,172.20 |
Accumulated other comprehensive loss | -547.3 | -281.1 |
Total shareholders' equity | 1,066.50 | 1,492.20 |
Total liabilities and shareholders' equity | $4,360.20 | $4,610.60 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ||
Trade accounts receivable, allowances (in dollars) | $30.50 | $31.60 |
Common stock, par value (in dollars per share) | $1 | $1 |
Common stock, authorized shares | 400,000,000 | 400,000,000 |
Common stock, issued shares | 124,126,624 | 124,126,624 |
Common stock, outstanding shares | 90,458,956 | 96,178,411 |
Treasury stock, shares | 33,667,668 | 27,948,213 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
CONSOLIDATED STATEMENTS OF INCOME | |||
Net sales | $6,330.30 | $6,140 | $5,863.50 |
Cost of products sold | 4,679.10 | 4,502.30 | 4,335.30 |
Gross profit | 1,651.20 | 1,637.70 | 1,528.20 |
Marketing, general and administrative expense | 1,155.30 | 1,179 | 1,148.90 |
Interest expense | 63.3 | 59 | 72.9 |
Other expense, net | 68.2 | 36.6 | 68.8 |
Income from continuing operations before taxes | 364.4 | 363.1 | 237.6 |
Provision for income taxes | 113.3 | 118.8 | 80 |
Income from continuing operations | 251.1 | 244.3 | 157.6 |
(Loss) income from discontinued operations, net of tax | -2.2 | -28.5 | 57.8 |
Net income | $248.90 | $215.80 | $215.40 |
Net income (loss) per common share: | |||
Continuing operations (in dollars per share) | $2.68 | $2.48 | $1.54 |
Discontinued operations (in dollars per share) | ($0.03) | ($0.29) | $0.56 |
Net income per common share (in dollars per share) | $2.65 | $2.19 | $2.10 |
Net income (loss) per common share, assuming dilution: | |||
Continuing operations (in dollars per share) | $2.62 | $2.44 | $1.52 |
Discontinued operations (in dollars per share) | ($0.02) | ($0.28) | $0.56 |
Net income per common share, assuming dilution (in dollars per share) | $2.60 | $2.16 | $2.08 |
Dividends per common share (in dollars per share) | $1.34 | $1.14 | $1.08 |
Weighted average shares outstanding: | |||
Common shares (in shares) | 93.8 | 98.4 | 102.6 |
Common shares, assuming dilution (in shares) | 95.7 | 100.1 | 103.5 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $248.90 | $215.80 | $215.40 |
Foreign currency translation: | |||
Translation (loss) gain | -154.7 | -53.3 | 43.6 |
Reclassifications to net income | 10.8 | ||
Pension and other postretirement benefits: | |||
Net actuarial (loss) gain | -192.2 | 68.2 | -111.6 |
Prior service credit (cost) | 7.3 | -19.9 | |
Reclassifications to net income: | |||
Amortization of net actuarial loss | 24.2 | 28.4 | 20.3 |
Amortization of prior service credit | -1.7 | -3.3 | -4 |
Amortization of transition asset | -0.1 | -0.5 | |
Net curtailment of pension and post-retirement benefit obligations | 0.6 | -13.3 | |
Settlement of pension obligations | 1 | 1.2 | 0.6 |
Cash flow hedges: | |||
Losses (gains) recognized on cash flow hedges | 0.2 | 1 | -1.8 |
Reclassifications to net income | 1.2 | 0.3 | 9.7 |
Other comprehensive (loss) income, before tax | -314.1 | 20 | -43.7 |
Income tax (benefit) expense related to items of other comprehensive income (loss) | -47.9 | 23.1 | -28.9 |
Other comprehensive loss, net of tax | -266.2 | -3.1 | -14.8 |
Total comprehensive (loss) income, net of tax | ($17.30) | $212.70 | $200.60 |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Common Stock | Capital in excess of par value | Retained Earnings | Treasury stock | Accumulated Other Comprehensive Loss | Total |
In Millions, unless otherwise specified | ||||||
Balance at Dec. 31, 2011 | $124.10 | $778.60 | $1,810.50 | ($791.50) | ($263.20) | $1,658.50 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 215.4 | 215.4 | ||||
Other comprehensive loss | -14.8 | -14.8 | ||||
Repurchase of 7,416,167, 6,555,672 and 7,927,344 shares for treasury for the years ended 2014, 2013, and 2012, respectively | -235.2 | -235.2 | ||||
Issuance of 1,299,931, 2,240,185 and 713,571 shares under stock-based compensation plans, including tax of $(4.1), $1.7 and $(3.8) for the years ended 2014,2013,and 2012, respectively. | 23.2 | -3.8 | 22.4 | 41.8 | ||
Contribution of 396,781, 578,441 and 844,311 shares to the 401(k) Plan for the years ended 2014, 2013, and 2012, respectively. | -0.9 | 26.5 | 25.6 | |||
Dividends: $1.34, $1.14 and $1.08 per share for the year ended 2014, 2013 and 2012, respectively | -110.4 | -110.4 | ||||
Balance at Dec. 29, 2012 | 124.1 | 801.8 | 1,910.80 | -977.8 | -278 | 1,580.90 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 215.8 | 215.8 | ||||
Other comprehensive loss | -3.1 | -3.1 | ||||
Repurchase of 7,416,167, 6,555,672 and 7,927,344 shares for treasury for the years ended 2014, 2013, and 2012, respectively | -283.5 | -283.5 | ||||
Issuance of 1,299,931, 2,240,185 and 713,571 shares under stock-based compensation plans, including tax of $(4.1), $1.7 and $(3.8) for the years ended 2014,2013,and 2012, respectively. | 10.5 | -11.6 | 70.7 | 69.6 | ||
Contribution of 396,781, 578,441 and 844,311 shares to the 401(k) Plan for the years ended 2014, 2013, and 2012, respectively. | 6.1 | 18.4 | 24.5 | |||
Dividends: $1.34, $1.14 and $1.08 per share for the year ended 2014, 2013 and 2012, respectively | -112 | -112 | ||||
Balance at Dec. 28, 2013 | 124.1 | 812.3 | 2,009.10 | -1,172.20 | -281.1 | 1,492.20 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 248.9 | 248.9 | ||||
Other comprehensive loss | -266.2 | -266.2 | ||||
Repurchase of 7,416,167, 6,555,672 and 7,927,344 shares for treasury for the years ended 2014, 2013, and 2012, respectively | -355.5 | -355.5 | ||||
Issuance of 1,299,931, 2,240,185 and 713,571 shares under stock-based compensation plans, including tax of $(4.1), $1.7 and $(3.8) for the years ended 2014,2013,and 2012, respectively. | 11.6 | -2 | 43.2 | 52.8 | ||
Contribution of 396,781, 578,441 and 844,311 shares to the 401(k) Plan for the years ended 2014, 2013, and 2012, respectively. | 6.2 | 13.2 | 19.4 | |||
Dividends: $1.34, $1.14 and $1.08 per share for the year ended 2014, 2013 and 2012, respectively | -125.1 | -125.1 | ||||
Balance at Jan. 03, 2015 | $124.10 | $823.90 | $2,137.10 | $1,471.30 | ($547.30) | $1,066.50 |
CONSOLIDATED_STATEMENTS_OF_SHA1
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Repurchase of shares for treasury | 7,400,000 | ||
Stock issued under stock-based compensation plans (in shares) | 1,299,931 | 2,240,185 | 713,571 |
Dividends per common share (in dollars per share) | $1.34 | $1.14 | $1.08 |
Treasury stock | |||
Repurchase of shares for treasury | 7,416,167 | 6,555,672 | 7,927,344 |
Stock issued under stock-based compensation plans (in shares) | -4.1 | 1.7 | -3.8 |
Stock issued under the Savings Plan (401(k) Plan) (in shares) | 396,781 | 578,441 | 844,311 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Operating Activities | |||
Net income | $248.90 | $215.80 | $215.40 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 135.5 | 135.6 | 150.1 |
Amortization | 66.1 | 69 | 70.5 |
Provision for doubtful accounts and sales returns | 20.7 | 16.3 | 19.5 |
Loss (gain) on sale of businesses | 3.4 | -49.3 | |
Indefinite-lived intangible asset impairment charge | 3 | 7 | |
Net losses (gains) from long-lived asset impairments and sales/disposals of assets | 10.2 | -5.8 | 11.7 |
Stock-based compensation | 28.3 | 34 | 38.9 |
Other non-cash expense and loss | 44.2 | 49.3 | 41.8 |
Other non-cash income and gain | -11.8 | ||
Changes in assets and liabilities and other adjustments: | |||
Trade accounts receivable | -40.9 | -110.8 | -106.7 |
Inventories | -33 | -75.9 | -0.8 |
Other current assets | -16 | 3.5 | -7.6 |
Accounts payable | -62.8 | 108.2 | 68 |
Accrued liabilities | -18.2 | -21.2 | 73.8 |
Taxes on income | 15.4 | -12.2 | 12.4 |
Deferred taxes | -18.2 | 54.1 | -1.3 |
Other assets | -3.5 | -5.4 | -4 |
Long-term retirement benefits and other liabilities | -8.9 | -73.3 | -75.3 |
Net cash provided by operating activities | 374.2 | 320.1 | 513.4 |
Investing Activities | |||
Purchases of property, plant and equipment | -147.9 | -129.2 | -99.2 |
Purchases of software and other deferred charges | -27.1 | -52.2 | -59.1 |
Proceeds from sale of product line | 0.8 | ||
Proceeds from sales of property, plant and equipment | 4.3 | 38.7 | 4.2 |
Sales (purchases) of investments, net | 0.3 | 0.1 | -6.7 |
Proceeds from sale of businesses, net of cash provided | 481.2 | ||
Other | 0.8 | ||
Net cash (used in) provided by investing activities | -170.4 | 339.4 | -160 |
Financing Activities | |||
Net increase (decrease) in borrowings (maturities of 90 days or less) | 126.5 | -435.3 | 42.3 |
Additional borrowings (maturities longer than 90 days) | 250 | ||
Payments of debt (maturities longer than 90 days) | -1.6 | -1.9 | -1.8 |
Dividends paid | -125.1 | -112 | -110.4 |
Share repurchases | -355.5 | -283.5 | -235.2 |
Proceeds from exercises of stock options, net | 34.2 | 44.8 | 10.2 |
Other | -2 | -8.3 | -2.7 |
Net cash used in financing activities | -323.5 | -546.2 | -297.6 |
Effect of foreign currency translation on cash balances | -4.9 | 2.9 | 1.6 |
(Decrease) increase in cash and cash equivalents | -124.6 | 116.2 | 57.4 |
Cash and cash equivalents, beginning of year | 351.6 | 235.4 | 178 |
Cash and cash equivalents, end of year | $227 | $351.60 | $235.40 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |
Jan. 03, 2015 | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Nature of Operations | ||
We develop identification and decorative solutions primarily for businesses worldwide. Our products include pressure-sensitive labeling technology and materials; graphics imaging media; retail branding and information solutions; radio-frequency identification ("RFID") inlays and tags; performance tapes; and medical solutions. | ||
Principles of Consolidation | ||
The consolidated financial statements include the accounts of majority-owned subsidiaries. Intercompany accounts, transactions and profits are eliminated in consolidation. | ||
Financial Presentation | ||
In the first quarter of 2014, we began reporting Vancive Medical Technologies as a reportable segment. This business was previously reported within a category entitled "other specialty converting businesses" and was the only business that comprised that category in the prior periods presented. | ||
As further discussed in Note 2, "Discontinued Operations and Sale of Assets," we have classified the operating results of our Office and Consumer Products ("OCP") and Designed and Engineered Solutions ("DES") businesses, together with certain costs associated with their divestiture, as discontinued operations in the Consolidated Statements of Income for all periods presented. Unless otherwise noted, the results and financial condition of discontinued operations have been excluded from the notes to our Consolidated Financial Statements. | ||
Fiscal Year | ||
Normally, our fiscal years consist of 52 weeks, but every fifth or sixth fiscal year consists of 53 weeks. Our 2014 fiscal year consisted of a 53-week period ending January 3, 2015 and our 2013 and 2012 fiscal years consisted of 52-week periods ending December 28, 2013 and December 29, 2012, respectively. | ||
Use of Estimates | ||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions for the reporting period and as of the date of the financial statements. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenue and expense. Actual results could differ from these estimates. | ||
Cash and Cash Equivalents | ||
Cash and cash equivalents consist of cash on hand, deposits in banks, and short-term investments with maturities of three months or less when purchased. The carrying value of these assets approximates fair value due to the short maturity of the instruments. | ||
Accounts Receivable | ||
We record trade accounts receivable at the invoiced amount. The allowance for doubtful account reserve represents allowances for customer trade accounts receivable that are estimated to be partially or entirely uncollectible. The customer complaint reserve represents estimated sales returns and allowances. These allowances are used to reduce gross trade receivables to their net realizable values. We record these allowances based on estimates related to: | ||
• | Customer-specific allowances; | |
• | Amounts based upon an aging schedule; and | |
• | An amount, based on our historical experience, for allowances not yet identified. | |
No single customer represented 10% or more of our net sales in, or trade accounts receivable at, year-end 2014 or 2013. However, during 2014, our ten largest customers by net sales represented 13% of our net sales. As of January 3, 2015, our ten largest customers by trade accounts receivable represented 15% of our trade accounts receivable. These customers were concentrated in the Pressure-sensitive Materials segment. We do not generally require our customers to provide collateral. | ||
Inventories | ||
Inventories are stated at the lower-of-cost-or-market value and are categorized as raw materials, work-in-progress or finished goods. Cost is determined using the first-in, first-out ("FIFO") method. Inventory reserves are recorded to cost of products sold for damaged, obsolete, excess and slow-moving inventory and we establish a lower cost basis for the inventory. We use estimates to record these reserves. Slow-moving inventory is reviewed by category and may be partially or fully reserved for depending on the type of product, level of usage, and the length of time the product has been included in inventory. | ||
Property, Plant and Equipment | ||
Depreciation is generally computed using the straight-line method over the estimated useful lives of the assets, ranging from ten to forty-five years for buildings and improvements and three to fifteen years for machinery and equipment. Leasehold improvements are depreciated over the shorter of the useful life of the asset or the term of the associated leases. Maintenance and repair costs are expensed as incurred; renewals and betterments are capitalized. Upon the sale or retirement of assets, the accounts are relieved of the cost and the related accumulated depreciation, with any resulting gain or loss included in net income. | ||
Software | ||
We capitalize internal and external software costs that are incurred during the application development stage of software development, including costs incurred for the design, coding, installation to hardware, testing, and upgrades and enhancements that provide the software or hardware with additional functionalities and capabilities. Internal and external software costs during the preliminary project stage are expensed, as are those costs during the post-implementation and/or operation stage, including internal and external training costs and maintenance costs. Capitalized software, which is included in "Other assets" in the Consolidated Balance Sheets, is amortized on a straight-line basis over the estimated useful life of the software, generally between five and ten years. | ||
Impairment of Long-lived Assets | ||
Impairment charges are recorded when the carrying amounts of long-lived assets are determined not to be recoverable. Recoverability is measured by comparing the undiscounted cash flows expected from their use and eventual disposition to the carrying value of the related asset or asset group. The amount of impairment loss is calculated as the excess of the carrying value over the fair value. Historically, changes in market conditions and management strategy have caused us to reassess the carrying amount of our long-lived assets. | ||
Goodwill and Other Intangibles Resulting from Business Acquisitions | ||
Business combinations are accounted for by the acquisition method, with the excess of the acquisition cost over the fair value of net tangible assets and identified intangible assets acquired considered goodwill. As a result, we disclose goodwill separately from other intangible assets. Other identifiable intangibles include customer relationships, patents and other acquired technology, trade names and trademarks, and other intangibles. | ||
We have the following reporting units: materials; retail branding and information solutions; reflective solutions; performance tapes; and medical solutions. In performing the required impairment tests, we primarily apply a present value (discounted cash flow) method to determine the fair value of the reporting units with goodwill. We perform our annual impairment test of goodwill during the fourth quarter. | ||
Certain factors may result in the need to perform an impairment test prior to the fourth quarter, including significant underperformance of a business relative to expected operating results, significant adverse economic and industry trends, significant decline in our market capitalization for an extended period of time relative to net book value, or a decision to divest a portion of a reporting unit. | ||
We determine goodwill impairment using a two-step process. The first step is to identify if a potential impairment exists by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered to have a potential impairment and the second step of the impairment test is not necessary. However, if the carrying amount of a reporting unit exceeds its fair value, the second step is performed to determine if goodwill is impaired and to measure the amount of impairment loss to recognize, if any. | ||
The second step, if necessary, compares the implied fair value of goodwill with the carrying amount of goodwill. If the implied fair value of goodwill exceeds the carrying amount, then goodwill is not considered impaired. However, if the carrying amount of goodwill exceeds the implied fair value, an impairment loss is recognized in an amount equal to that excess. | ||
In consultation with outside specialists, we estimate the fair value of our reporting units using various valuation techniques, with the primary technique being a discounted cash flow analysis. A discounted cash flow analysis requires us to make various assumptions about the reporting units, including sales, operating margins, growth rates, and discount rates. Assumptions about discount rates are based on a weighted-average cost of capital for comparable companies. Assumptions about sales, operating margins, and growth rates are based on our forecasts, business plans, economic projections, anticipated future cash flows and marketplace data. Assumptions are also made for varying perpetual growth rates for periods beyond the long-term business plan period. We base our fair value estimates on projected financial information and assumptions that we believe are reasonable. However, actual future results may differ from those estimates and projections, and those differences may be material. The valuation methodology used to estimate the fair value of reporting units requires inputs and assumptions that reflect current market conditions, as well as the impact of planned business and operational strategies that require management judgment. The estimated fair value could increase or decrease depending on changes in the inputs and assumptions. | ||
We test indefinite-lived intangible assets, consisting of trademarks, for impairment in the fourth quarter or whenever events or circumstances indicate that it is more likely than not that their carrying values exceed their fair values. Fair value is estimated as the discounted value of future revenues using a royalty rate that a third party would pay for use of the asset. Variation in the royalty rates could impact the estimate of fair value. If the carrying amount of an asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. | ||
See also Note 3, "Goodwill and Other Intangibles Resulting from Business Acquisitions." | ||
Foreign Currency | ||
Asset and liability accounts of international operations are translated into U.S. dollars at current rates. Revenues and expenses are translated at the weighted-average currency rate for the fiscal year. Translation gains and losses of subsidiaries operating in hyperinflationary economies, if any, are included in net income in the period incurred. Gains and losses resulting from hedging the value of investments in certain international operations and from translation of balance sheet accounts are recorded directly as a component of other comprehensive income. | ||
Financial Instruments | ||
We enter into foreign exchange hedge contracts to reduce our risk from exchange rate fluctuations associated with receivables, payables, loans and firm commitments denominated in certain foreign currencies that arise primarily as a result of our operations outside the U.S. We enter into interest rate contracts to help manage our exposure to certain interest rate fluctuations. We also enter into futures contracts to hedge certain price fluctuations for a portion of our anticipated domestic purchases of natural gas. The maximum length of time for which we hedge our exposure to the variability in future cash flows for forecasted transactions is 36 months. | ||
On the date we enter into a derivative contract, we determine whether the derivative will be designated as a hedge. Those derivatives not designated as hedges are recorded on the balance sheets at fair value, with changes in the fair value recognized in earnings. Those derivatives designated as hedges are classified as either (1) hedges of the fair value of a recognized asset or liability or an unrecognized firm commitment ("fair value" hedges); or (2) hedges of a forecasted transaction or the variability of cash flows that are to be received or paid in connection with a recognized asset or liability ("cash flow" hedges). Our policy is not to purchase or hold any foreign currency, interest rate or commodity contracts for trading purposes. | ||
We assess, both at the inception of the hedge and on an ongoing basis, whether hedges are highly effective. If it is determined that a hedge is not highly effective, we prospectively discontinue hedge accounting. For cash flow hedges, the effective portion of the related gains and losses is recorded as a component of other comprehensive income, and the ineffective portion is reported in earnings. Amounts in accumulated other comprehensive income (loss) are reclassified into earnings in the same period during which the hedged transaction affects earnings. In the event the anticipated transaction is no longer likely to occur, we recognize the change in fair value of the instrument in current period earnings. Changes in fair value hedges are recognized in current period earnings. Changes in the fair value of underlying hedged items (such as recognized assets or liabilities) are also recognized in current period earnings and offset the changes in the fair value of the derivative. | ||
In the Consolidated Statements of Cash Flows, hedge transactions are classified in the same category as the item hedged, primarily in operating activities. | ||
See also Note 5, "Financial Instruments." | ||
Fair Value Measurements | ||
We define fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability. | ||
We determine fair value based on a three-tier fair value hierarchy, which we use to prioritize the inputs used in measuring fair value. These tiers consist of Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring us to develop our own assumptions to determine the best estimate of fair value. | ||
Revenue Recognition | ||
Sales are recognized when persuasive evidence of an arrangement exists, pricing is determinable, delivery has occurred based on applicable sales terms, and collection is reasonably assured. Sale terms are generally free on board (f.o.b.) shipping point or f.o.b. destination, depending upon local business customs. For most regions in which we operate, f.o.b. shipping point terms are utilized and sales are recorded at the time of shipment, because this is when title and risk of loss are transferred. In certain regions, notably in Europe, f.o.b. destination terms are generally utilized and sales are recorded when the products are delivered to the customer's delivery site, because this is when title and risk of loss are transferred. Furthermore, sales, provisions for estimated returns, and the cost of products sold are recorded at the time title transfers to customers and when the customers assume the risks and rewards of ownership. Actual product returns are charged against estimated sales return allowances. | ||
Sales rebates and discounts are common practice in the industries in which we operate. Volume, promotional, price, cash and other discounts and customer incentives are accounted for as a reduction to gross sales. Rebates and discounts are recorded based upon estimates at the time products are sold. These estimates are based on our historical experience for similar programs and products. We review these rebates and discounts on an ongoing basis and accruals for rebates and discounts are adjusted, if necessary, as additional information becomes available. | ||
Research and Development | ||
Research and development costs are related to research, design and testing of new products and applications and are expensed as incurred. | ||
Long-Term Incentive Compensation | ||
No long-term incentive compensation expense was capitalized for the years ended 2014, 2013, or 2012. | ||
Changes in estimated forfeiture rates are recorded as cumulative adjustments in the period estimates are revised. | ||
Valuation of Stock-Based Awards | ||
Our stock-based compensation expense is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a straight-line basis over the requisite service period for stock options and restricted stock units ("RSUs"). Compensation expense for performance units ("PUs") is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a straight-line basis as these awards cliff-vest at the end of the requisite service period. The compensation expense related to market-leveraged stock units ("MSUs") is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a graded-vesting basis over their respective performance periods. | ||
Compensation expense for awards with a market condition as a performance objective, which includes PUs and MSUs, is not adjusted if the condition is not met, as long as the requisite service period is met. | ||
The fair value of stock options is estimated as of the date of grant using the Black-Scholes option-pricing model. This model requires input assumptions for our expected dividend yield, expected stock price volatility, risk-free interest rate and the expected option term. | ||
The fair value of RSUs and certain PUs that are subject to achievement of performance objectives based on a performance condition is determined based on the fair market value of our common stock as of the date of grant, adjusted for foregone dividends. | ||
The fair value of stock-based awards that are subject to achievement of performance objectives based on a market condition, which includes MSUs and certain PUs, is determined using the Monte-Carlo simulation model, which utilizes multiple input variables, including expected volatility and other assumptions appropriate for determining fair value, to estimate the probability of satisfying the target performance objectives established for the award. | ||
Certain of these assumptions are based on management's estimates, in consultation with outside specialists. Significant changes in assumptions for future awards and actual forfeiture rates could materially impact stock-based compensation expense and our results of operations. | ||
Valuation of Cash-Based Awards | ||
Cash-based awards consist of long-term incentive units ("LTI Units") granted to eligible employees. Cash-based awards are classified as liability awards and remeasured at each quarter-end over the applicable vesting or performance period. In addition to LTI Units with terms and conditions that mirror those of RSUs, we also grant certain employees LTI Units with terms and conditions that mirror those of PUs and MSUs. | ||
Accounting for Income Taxes for Stock-Based Compensation | ||
We elected to use the short-cut method to calculate the historical pool of windfall tax benefits related to employee and non-employee director stock-based compensation awards. In addition, we elected to follow the tax law ordering approach to determine the sequence in which deductions and net operating loss carryforwards are utilized, as well as the direct-only approach to calculate the amount of windfall or shortfall tax benefits. | ||
See also Note 12, "Long-term Incentive Compensation." | ||
Taxes Based on Income | ||
Our provision for income taxes is determined using the asset and liability approach following the provisions of ASC 740, Accounting for Income Taxes. Under this approach, deferred income taxes represent the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities. We record a valuation allowance to reduce our deferred tax assets when uncertainty regarding their realizability exists. We recognize and measure our uncertain tax positions following the more-likely-than-not threshold for financial statement recognition and measurement for tax positions taken or expected to be taken in a tax return. | ||
See also Note 14, "Taxes Based on Income." | ||
Recent Accounting Requirements | ||
In January 2015, the Financial Accounting Standards Board ("FASB") issued guidance on simplification of income statement classification by removing the concept of extraordinary items from GAAP. Items that are both unusual and infrequent will no longer be separately reported net of tax after continuing operations. The existing requirement to separately present items that are of an unusual nature or occur infrequently on a pre-tax basis within income from continuing operations has been retained and was expanded to include items that are both unusual and infrequent. These items may be presented in the income statement or disclosed in the footnotes to the financial statements. The guidance is effective for periods beginning after December 15, 2015. Early adoption is permitted, but only as of the beginning of the fiscal year of adoption. We expect our adoption of this standard to have no impact on our financial position, results of operations, cash flows, or disclosures. | ||
In August 2014, the FASB issued a new standard that requires an entity to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern. Management's evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. Under this new standard, substantial doubt exists when it is probable that the entity will be unable to meet its obligations as they become due within one year of the date the financial statements are issued. If applicable, certain disclosures are required, including management's plans to mitigate those relevant conditions or events to alleviate the substantial doubt. This standard is effective for annual periods and interim periods within those annual periods ending after December 15, 2016. Early adoption is permitted. We expect our adoption of this standard to have no impact on our financial position, results of operations, cash flows, or disclosures. | ||
In June 2014, the FASB revised guidance on share-based compensation awards that require a specific performance target to be achieved in order for the awards to vest. This revised guidance requires that a performance target that impacts vesting and can be achieved after the requisite service period be treated as a performance condition. As such, a performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that a performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. The revised guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and can be applied either (i) prospectively to all awards granted or modified after the effective date or (ii) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. We do not anticipate our adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
In May 2014, the FASB issued revised guidance on revenue recognition. This revised guidance provides a single comprehensive model for accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This revised guidance will require an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update creates a five-step model that requires entities to exercise judgment when considering the terms of contract(s), which includes (i) identifying the contract(s) with the customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the separate performance obligations, and (v) recognizing revenue when each performance obligation is satisfied. This revised guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This revised guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and can be applied retrospectively either to each prior reporting period presented or with the cumulative effect of adoption recognized at the date of initial application. Early adoption is not permitted. We are evaluating the impact adoption of this revised guidance will have on our financial position, results of operations, cash flows, or disclosures. Based on the information that we have evaluated to date, we do not anticipate the adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
In April 2014, the FASB issued revised guidance on reporting discontinued operations. This revised guidance defines a discontinued operation as a disposal of a component or a group of components of an entity that represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results. This revised guidance also requires additional disclosures for discontinued operations and new disclosures for individually material disposal transactions that do not meet the definition of a discontinued operation. This revised guidance is effective for fiscal years beginning on or after December 15, 2014 and interim periods within those years, with earlier adoption permitted. We do not anticipate the adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
DISCONTINUED_OPERATIONS_AND_SA
DISCONTINUED OPERATIONS AND SALE OF ASSETS | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Discontinued Operations, Exit/Sale of Product Lines, Sale of Assets and Assets Held for Sale | |||||||||||
DISCONTINUED OPERATIONS AND SALE OF ASSETS | NOTE 2. DISCONTINUED OPERATIONS AND SALE OF ASSETS | ||||||||||
Discontinued Operations | |||||||||||
On January 29, 2013, we entered into an agreement to sell our former OCP and DES businesses to CCL Industries Inc. ("CCL"). | |||||||||||
On July 1, 2013, we completed the sale for a total purchase price of $500 million ($481.2 million net of cash provided) and entered into an amendment to the purchase agreement, which, among other things, increased the target net working capital amount and amended provisions related to employee matters and indemnification. We continue to be subject to certain indemnification obligations under the terms of the purchase agreement. In addition, the tax liability associated with the sale is subject to completion of tax return filings in certain foreign jurisdictions where we operated the OCP and DES businesses. | |||||||||||
At closing, we entered into a supply agreement, pursuant to which CCL agreed to purchase certain pressure-sensitive label stock, adhesives and other base material products for up to six years after closing. While the supply agreement is expected to continue generating revenues and cash flows from the OCP and DES businesses, our continuing involvement in the OCP and DES operations is not expected to be significant to us as a whole. | |||||||||||
The operating results of the discontinued operations and loss on sale were as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales | $ | – | $ | 380.4 | $ | 912.3 | |||||
| | | | | | | | | | | |
(Loss) income before taxes, including divestiture-related and restructuring costs | $ | – | $ | (12.4 | ) | $ | 86.4 | ||||
Provision for income taxes | – | (.1 | ) | (28.6 | ) | ||||||
| | | | | | | | | | | |
(Loss) income from discontinued operations, net of tax before loss on sale | – | (12.5 | ) | 57.8 | |||||||
(Loss) gain on sale before taxes | (3.3 | ) | 49.4 | – | |||||||
Tax benefit (provision) on sale | 1.1 | (65.4 | ) | – | |||||||
| | | | | | | | | | | |
(Loss) income from discontinued operations, net of tax | $ | (2.2 | ) | $ | (28.5 | ) | $ | 57.8 | |||
| | | | | | | | | | | |
The loss from discontinued operations, net of tax, for 2014 reflected costs related to the resolution of certain post-closing adjustments, including completion of the final purchase price allocation in the third quarter of 2014. | |||||||||||
The loss before taxes, including divestiture-related and restructuring costs, for 2013 included a curtailment gain associated with our postretirement health and welfare benefit plans, partially offset by divestiture-related costs. Refer to Note 6, "Pension and Other Postretirement Benefits," for information regarding the curtailment gain. The (loss) income from discontinued operations, net of tax, reflected the elimination of certain corporate cost allocations. The income tax provision included in the net loss on sale reflects tax versus book basis differences, primarily associated with goodwill. | |||||||||||
Net sales from continuing operations to discontinued operations were $45.8 million and $100 million during 2013 and 2012, respectively. These sales have been included in "Net sales" in the Consolidated Statements of Income. | |||||||||||
Sale of Assets | |||||||||||
In September 2014, we sold properties in Framingham, Massachusetts used primarily as the former headquarters of our Retail Branding and Information Solutions business for $3.3 million, recognizing a pre-tax gain of $1.9 million. In April 2013, we sold the property and equipment of our former corporate headquarters in Pasadena, California for approximately $20 million, recognizing a pre-tax gain of $10.9 million. During 2013, we also completed the sale of certain property, plant and equipment in China for approximately $11 million, as well as the sale of a research facility also located in Pasadena, California for approximately $5 million. These gains were recorded in "Other expense, net" in the Consolidated Statements of Income. | |||||||||||
GOODWILL_AND_OTHER_INTANGIBLES
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Goodwill and Other Intangibles Resulting from Business Acquisitions | ||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS | NOTE 3. GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS | |||||||||||||||||||
Goodwill | ||||||||||||||||||||
Results from our annual impairment test in the fourth quarter of 2014 indicated that no impairment had occurred in 2014 related to goodwill. The fair value of these assets was primarily based on Level 3 inputs. | ||||||||||||||||||||
Changes in the net carrying amount of goodwill for 2014 and 2013 by reportable segment were as follows: | ||||||||||||||||||||
(In millions) | Pressure- | Retail | Other | Total | ||||||||||||||||
sensitive | Branding and | specialty | ||||||||||||||||||
Materials | Information | converting | ||||||||||||||||||
Solutions | businesses | |||||||||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of December 29, 2012 | $ | 338.3 | $ | 422.6 | $ | 3.5 | $ | 764.4 | ||||||||||||
Divestiture (1) | – | – | (3.5 | ) | (3.5 | ) | ||||||||||||||
Acquisition adjustments | – | (.2 | ) | – | (.2 | ) | ||||||||||||||
Translation adjustments | (3.9 | ) | (5.7 | ) | – | (9.6 | ) | |||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of December 28, 2013 | 334.4 | 416.7 | – | 751.1 | ||||||||||||||||
Acquisition adjustments (2) | 0.4 | 7 | – | 7.4 | ||||||||||||||||
Translation adjustments | (28.2 | ) | (8.7 | ) | – | (36.9 | ) | |||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of January 3, 2015 | $ | 306.6 | $ | 415 | $ | – | $ | 721.6 | ||||||||||||
| | | | | | | | | | | | | | |||||||
-1 | See Note 2, "Discontinued Operations and Sale of Assets," for more information. | |||||||||||||||||||
-2 | Acquisition adjustments related to deferred taxes from previous acquisitions. See Note 14, "Taxes Based on Income," for more information. | |||||||||||||||||||
The carrying amounts of goodwill at January 3, 2015 and December 28, 2013 were net of accumulated impairment losses of $820 million, which were included in our Retail Branding and Information Solutions reportable segment. | ||||||||||||||||||||
There was no goodwill associated with our Vancive Medical Technologies reportable segment. | ||||||||||||||||||||
Indefinite-Lived Intangible Assets | ||||||||||||||||||||
In the third quarter of 2014, we determined that there was a need to conduct an interim impairment test of our indefinite-lived intangible assets, consisting of certain trade names and trademarks. The factors considered included a shortfall in 2014 full-year projected revenue and a reduction in 2015 projected revenue associated with these assets. The interim impairment test indicated that the fair value of our indefinite-lived intangible assets was less than their carrying value, which resulted in a non-cash asset impairment charge of $3 million. This charge was recorded in "Other expense, net" in the Consolidated Statements of Income and included in our Retail Branding and Information Solutions reportable segment. Results from our annual impairment test in the fourth quarter of 2014 indicated that no further impairment had occurred related to indefinite-lived intangible assets. The fair value of these assets was primarily based on Level 3 inputs. | ||||||||||||||||||||
In conjunction with the preparation for our annual impairment test in the fourth quarter of 2012, we determined that the carrying value of our indefinite-lived intangible assets consisting of certain trade names and trademarks exceeded their fair value, which resulted in a non-cash impairment charge of $7 million. This charge was recorded in "Other expense, net" in the Consolidated Statements of Income and included in our Retail Branding and Information Solutions reportable segment. The fair value of these assets was primarily based on Level 3 inputs. | ||||||||||||||||||||
The carrying value of indefinite-lived intangible assets resulting from business acquisitions, consisting of trade names and trademarks, was $7.9 million and $10.9 million at January 3, 2015 and December 28, 2013, respectively. | ||||||||||||||||||||
Finite-Lived Intangible Assets | ||||||||||||||||||||
The following table sets forth our finite-lived intangible assets resulting from business acquisitions at January 3, 2015 and December 28, 2013, which continue to be amortized: | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In millions) | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||
Carrying | Amortization | Carrying | Carrying | Amortization | Carrying | |||||||||||||||
Amount | Amount | Amount | Amount | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Customer relationships | $ | 228.9 | $ | 180.2 | $ | 48.7 | $ | 234.1 | $ | 164.6 | $ | 69.5 | ||||||||
Patents and other acquired technology | 49.0 | 42.7 | 6.3 | 48.9 | 38.3 | 10.6 | ||||||||||||||
Trade names and trademarks | 24.0 | 20.5 | 3.5 | 26.2 | 22.5 | 3.7 | ||||||||||||||
Other intangibles | 12.3 | 11.3 | 1.0 | 12.4 | 11.1 | 1.3 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 314.2 | $ | 254.7 | $ | 59.5 | $ | 321.6 | $ | 236.5 | $ | 85.1 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
Amortization expense from continuing operations for finite-lived intangible assets resulting from business acquisitions was $24.4 million for 2014, $28.5 million for 2013, and $29.9 million for 2012. | ||||||||||||||||||||
The estimated amortization expense for finite-lived intangible assets resulting from business acquisitions for each of the next five fiscal years is expected to be as follows: | ||||||||||||||||||||
(In millions) | Estimated | |||||||||||||||||||
Amortization | ||||||||||||||||||||
Expense | ||||||||||||||||||||
| | | | | ||||||||||||||||
2015 | $ | 20.8 | ||||||||||||||||||
2016 | 19.0 | |||||||||||||||||||
2017 | 9.9 | |||||||||||||||||||
2018 | 2.4 | |||||||||||||||||||
2019 | 1.8 | |||||||||||||||||||
| | | | | ||||||||||||||||
DEBT_AND_CAPITAL_LEASES
DEBT AND CAPITAL LEASES | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Debt | ||||||||
DEBT AND CAPITAL LEASES | NOTE 4. DEBT AND CAPITAL LEASES | |||||||
Short-Term Borrowings | ||||||||
We had $87 million of borrowings from commercial paper issuances outstanding (weighted-average interest rate of .4%) at January 3, 2015. We had no outstanding short-term variable rate borrowings from commercial paper issuances at December 28, 2013. | ||||||||
Short-Term Credit Facilities | ||||||||
In October 2014, we amended and restated our revolving credit facility (the "Revolver") with certain domestic and foreign banks, increasing the amount available thereunder from $675 million to $700 million. The amendment also extended the Revolver's maturity date from December 22, 2016 to October 3, 2019 and adjusted pricing to reflect favorable market conditions. The maturity date may be extended for additional one-year periods under certain circumstances. The commitments under the Revolver may be increased by up to $325 million, subject to lender approval and customary requirements. The Revolver is used as a back-up facility for our commercial paper program and can be used to finance other corporate requirements. | ||||||||
No balances were outstanding under the Revolver as of January 3, 2015 or December 28, 2013. Commitment fees associated with this facility in 2014, 2013, and 2012 were $1.3 million, $1.4 million, and $1.4 million, respectively. | ||||||||
Uncommitted lines of credit were approximately $316 million at January 3, 2015. These lines may be cancelled at any time by us or the issuing banks. Short-term borrowings outstanding under uncommitted lines of credit were $111.6 million (weighted-average interest rate of 9.4%) and $73.9 million (weighted-average interest rate of 11.2%) at January 3, 2015 and December 28, 2013, respectively. | ||||||||
Long-Term Borrowings and Capital Leases | ||||||||
Long-term debt, including its respective interest rates, and capital lease obligations at year-end consisted of the following: | ||||||||
(In millions) | 2014 | 2013 | ||||||
| | | | | | | | |
Long-term debt and capital leases | ||||||||
Medium-term notes: | ||||||||
Series 1995 due 2015 through 2025 | $ | 50 | $ | 50 | ||||
Long-term notes | ||||||||
Senior notes due 2017 at 6.6% | 249.6 | 249.6 | ||||||
Senior notes due 2020 at 5.4% | 249.9 | 249.9 | ||||||
Senior notes due 2023 at 3.4% | 249.7 | 249.7 | ||||||
Senior notes due 2033 at 6.0% | 150 | 150 | ||||||
Capital lease obligations | 1.8 | 3 | ||||||
Less amount classified as current | (5.7 | ) | (1.6 | ) | ||||
| | | | | | | | |
Total long-term debt and capital leases | $ | 945.3 | $ | 950.6 | ||||
| | | | | | | | |
Our medium-term notes have maturities from 2015 through 2025 and accrue interest at an average fixed rate of 7.5%. | ||||||||
Maturities of long-term debt and capital lease payments for each of the next five fiscal years and thereafter are expected to be as follows: | ||||||||
Year | (In millions) | |||||||
| | | | | ||||
2015 (classified as current) | $ | 5.7 | ||||||
2016 | 0.3 | |||||||
2017 | 249.9 | |||||||
2018 | 0.2 | |||||||
2019 | 0.2 | |||||||
2020 and thereafter | 694.7 | |||||||
| | | | | ||||
In April 2013, we issued $250 million of senior notes due April 2023. The notes bear an interest rate of 3.35% per year, payable semiannually in arrears. Net proceeds from the offering, after deducting underwriting discounts and offering expenses, of approximately $247.5 million were used to repay a portion of the indebtedness outstanding under our commercial paper program during the second quarter of 2013. | ||||||||
In January 2013, we repaid $250 million of senior notes at maturity using commercial paper borrowings. | ||||||||
Other | ||||||||
Our various loan agreements require that we maintain specified financial covenant ratios of total debt and interest expense in relation to certain measures of income. As of January 3, 2015, we were in compliance with our financial covenants. | ||||||||
Our total interest costs from continuing operations in 2014, 2013, and 2012, were $67.2 million, $62.3 million, and $76.2 million, respectively, of which $3.9 million, $3.3 million, and $3.3 million, respectively, were capitalized as part of the cost of assets. | ||||||||
The estimated fair value of our long-term debt is primarily based on the credit spread above U.S. Treasury securities on notes with similar rates, credit ratings, and remaining maturities. The fair value of short-term borrowings, which include commercial paper issuances and short-term lines of credit, approximates carrying value given the short duration of these obligations. The fair value of our total debt was $1.22 billion at January 3, 2015 and $1.06 billion at December 28, 2013. Fair value amounts were determined primarily based on Level 2 inputs. Refer to Note 1, "Summary of Significant Accounting Policies," for more information. | ||||||||
FINANCIAL_INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||
Jan. 03, 2015 | |||||||||||||
Financial Instruments | |||||||||||||
FINANCIAL INSTRUMENTS | NOTE 5. FINANCIAL INSTRUMENTS | ||||||||||||
As of January 3, 2015, the aggregate U.S. dollar equivalent notional value of our outstanding commodity contracts and foreign exchange contracts was $5.5 million and $1.4 billion, respectively. | |||||||||||||
We recognize all derivative instruments as either assets or liabilities at fair value in the Consolidated Balance Sheets. We designate commodity forward contracts on forecasted purchases of commodities and foreign exchange contracts on forecasted transactions as cash flow hedges and foreign exchange contracts on existing balance sheet items as fair value hedges. | |||||||||||||
The following table provides the fair value and balance sheet locations of derivatives as of January 3, 2015: | |||||||||||||
Asset | Liability | ||||||||||||
(In millions) | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||
| | | | | | | | | | | | ||
Foreign exchange contracts | Other current assets | $ | 10.3 | Other accrued liabilities | $ | 10.5 | |||||||
Commodity contracts | Other current assets | – | Other accrued liabilities | 1.0 | |||||||||
Long-term retirement benefits and other liabilities | 0.2 | ||||||||||||
| | | | | | | | | | | | ||
$ | 10.3 | $ | 11.7 | ||||||||||
| | | | | | | | | | | | ||
The following table provides the fair value and balance sheet locations of derivatives as of December 28, 2013: | |||||||||||||
Asset | Liability | ||||||||||||
(In millions) | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||
Foreign exchange contracts | Other current assets | $ | 3.1 | Other accrued liabilities | $ | 4.7 | |||||||
Commodity contracts | Other current assets | 0.1 | Other accrued liabilities | – | |||||||||
| | | | | | | | | | | | ||
$ | 3.2 | $ | 4.7 | ||||||||||
| | | | | | | | | | | | ||
Fair Value Hedges | |||||||||||||
For derivative instruments that are designated and qualify as fair value hedges, the gain or loss on the derivative and the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in current earnings, resulting in no material net impact to income. | |||||||||||||
The following table provides the components of the net gain (loss) recognized in income related to fair value hedge contracts. The corresponding gains or losses on the underlying hedged items approximated the net gain (loss) on these fair value hedge contracts. | |||||||||||||
(In millions) | Location of Gain (Loss) in Income | 2014 | 2013 | 2012 | |||||||||
| | | | | | | | | | | | | |
Foreign exchange contracts | Cost of products sold | $ | (1.6 | ) | $ | 2.3 | $ | – | |||||
Foreign exchange contracts | Marketing, general and administrative expense | (43.3 | ) | (35.9 | ) | 17.8 | |||||||
| | | | | | | | | | | | | |
$ | (44.9 | ) | $ | (33.6 | ) | $ | 17.8 | ||||||
| | | | | | | | | | | | | |
Cash Flow Hedges | |||||||||||||
For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of "Accumulated other comprehensive loss" and reclassified into earnings in the same period(s) during which the hedged transaction affects earnings. Gains and losses on the derivatives representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. | |||||||||||||
Gains (losses) recognized in "Accumulated other comprehensive loss" (effective portion) on derivatives related to cash flow hedge contracts were as follows: | |||||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||||
Foreign exchange contracts | $ | 1.3 | $ | 1.1 | $ | (.9 | ) | ||||||
Commodity contracts | (1.2 | ) | (.1 | ) | (.9 | ) | |||||||
| | | | | | | | | | | | | |
$ | 0.1 | $ | 1 | $ | (1.8 | ) | |||||||
| | | | | | | | | | | | | |
Amounts reclassified from "Accumulated other comprehensive loss" (effective portion) on derivatives related to cash flow hedge contracts were as follows: | |||||||||||||
(In millions) | Location of Gain (Loss) in Income | 2014 | 2013 | 2012 | |||||||||
Foreign exchange contracts | Cost of products sold | $ | (1.2 | ) | $ | 0.6 | $ | (2.5 | ) | ||||
Commodity contracts | Cost of products sold | 0.1 | (1.2 | ) | (2.8 | ) | |||||||
Interest rate contracts | Interest expense | (.1 | ) | (.1 | ) | (4.4 | ) | ||||||
| | | | | | | | | | | | | |
$ | (1.2 | ) | $ | (.7 | ) | $ | (9.7 | ) | |||||
| | | | | | | | | | | | | |
The amount of gain or loss recognized in income related to the ineffective portion of, and the amount excluded from, effectiveness testing for cash flow hedges and derivatives not designated as hedging instruments was not material in 2014, 2013, or 2012. | |||||||||||||
As of January 3, 2015, we expect a net gain of approximately $2 million to be reclassified from "Accumulated other comprehensive loss" to earnings within the next 12 months. | |||||||||||||
PENSION_AND_OTHER_POSTRETIREME
PENSION AND OTHER POSTRETIREMENT BENEFITS | 12 Months Ended | ||||||||||||||||||||||||||||
Jan. 03, 2015 | |||||||||||||||||||||||||||||
Pension and Other Postretirement Benefits. | |||||||||||||||||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | NOTE 6. PENSION AND OTHER POSTRETIREMENT BENEFITS | ||||||||||||||||||||||||||||
Defined Benefit Plans | |||||||||||||||||||||||||||||
We sponsor a number of defined benefit plans, the accrual of benefits under some of which has been frozen, covering eligible employees in the U.S. and certain other countries. Benefits payable to an employee are based primarily on years of service and the employee's compensation during the course of his or her employment with us. While we have not expressed any intent to terminate these plans, we may do so at any time, subject to applicable laws and regulations. | |||||||||||||||||||||||||||||
We are also obligated to pay unfunded termination indemnity benefits to certain employees outside of the U.S., which are subject to applicable agreements, local laws and regulations. We have not incurred significant costs related to termination indemnity arrangements, and therefore, no related costs are included in the disclosures below. | |||||||||||||||||||||||||||||
Employees who participated in our U.S. defined benefit plan, the Avery Dennison Pension Plan ("ADPP"), between December 1, 1986 and November 30, 1997, may also have had a Stock Holding and Retirement Enhancement Account ("SHARE Account") associated with our defined contribution plan. The ADPP is a floor offset plan that coordinated the amount of projected benefit obligation to an eligible participant with the SHARE Account such that the total benefit payable to an eligible participant would equal the greater of the value of the participant's benefit from the ADPP or the value of the participant's SHARE Account. Lower than expected asset returns on the participant balances in the SHARE Account could have increased the projected benefit obligation under the ADPP. In the fourth quarter of 2013, we amended our plan documents to require participants to make an early election rather than waiting to make such election upon termination of employment either to (a) receive their assets in the SHARE Account as a distribution, in which case their retirement benefit under the ADPP would be offset by the annuity equivalent of these assets, or (b) transfer their SHARE Account assets to the ADPP and receive the full ADPP retirement benefit in annuity form. The amendment resulted in an actuarial loss of approximately $20 million to the ADPP in 2013. In the fourth quarter of 2014, all participants with a SHARE Account completed their elections and the existing SHARE Accounts were terminated, resulting in our recording an additional actuarial loss of $12 million. These actuarial losses are subject to future amortization. | |||||||||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||||||
Our investment management of the ADPP assets utilizes a liability driven investment (LDI) strategy. Under an LDI strategy, the assets are invested in a diversified portfolio that is split into two sub-portfolios: a growth portfolio and a liability hedging portfolio. The growth portfolio consists primarily of equity and high-yield fixed income securities. The liability hedging portfolio consists primarily of investment grade fixed income securities and cash, and is intended, over time, to more closely match the liabilities of the plan. The investment objective of the portfolio is to improve the funded status of the plan; as funded status reaches certain trigger points, the portfolio moves to a more conservative asset allocation by increasing the allocation to the liability hedging portfolio. The current allocation is 65% in the growth portfolio and 35% in the liability hedging portfolio, subject to periodic fluctuations due to market movements. The plan assets are diversified across asset classes, striving to balance risk and return within the limits of prudent risk-taking and Section 404 of the Employee Retirement Income Security Act of 1974, as amended. Because many of the pension liabilities are long-term, the investment horizon is also long-term, but the investment plan must also ensure adequate near-term liquidity to fund benefit payments. | |||||||||||||||||||||||||||||
Assets of our international plans are invested in accordance with locally accepted practices and primarily include equity securities, fixed income securities, insurance contracts and cash. Asset allocations and investments vary by country and plan. Our target plan asset investment allocation for our international plans combined is 39% in equity securities, 49% in fixed income securities and cash, and 12% in insurance contracts and other investments, and is subject to periodic fluctuations in these respective asset classes. | |||||||||||||||||||||||||||||
Fair Value Measurements | |||||||||||||||||||||||||||||
The following is a description of the valuation methodologies used for assets measured at fair value: | |||||||||||||||||||||||||||||
Cash is valued at nominal value. Money market funds are valued at net asset value ("NAV"). Mutual funds are valued at fair value as determined by quoted market prices, based upon the NAV of shares held by the plans at year-end. Pooled funds, which include real estate pooled funds and multi-asset common trust funds, are comprised of shares or units in funds that are not publicly traded and are valued at net unit value, as determined by the fund's trustees based on the underlying securities in the trust. Equities are valued at the closing price reported on the active market on which the individual securities are traded. Real estate investment trusts are valued based on quoted prices in active markets. Debt securities consist primarily of treasury securities and corporate bonds, which are valued using bid prices; observable market inputs to determine these prices include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids and offers. Insurance contracts are valued at book value, which approximates fair value and is calculated using the prior year balance plus or minus investment returns and changes in cash flows. Pooled funds – alternative investments are investments in a fund of hedge funds, which are valued monthly on a one-month lag using a market approach valuation technique. We assess information available to us to determine whether there are any material changes to values at the reporting date. This investment was classified as a Level 3 asset as shares may be redeemed quarterly upon 65 days' notice and are subject to certain restrictions. | |||||||||||||||||||||||||||||
The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while we believe the valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. | |||||||||||||||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, U.S. plan assets (all in the ADPP) at fair value as of year-end 2014: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 1.3 | $ | 1.3 | $ | – | $ | – | |||||||||||||||||||||
Liability hedging portfolio | |||||||||||||||||||||||||||||
Pooled funds – Corporate debt/agencies | 152.4 | – | 152.4 | – | |||||||||||||||||||||||||
Pooled funds – Fixed income | 218.7 | – | 218.7 | – | |||||||||||||||||||||||||
Pooled funds – U.S. bonds, other fixed income | 0.4 | – | 0.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total liability hedging portfolio | 371.5 | – | 371.5 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Growth portfolio (1) | |||||||||||||||||||||||||||||
Pooled funds – Global equities | 60.2 | – | 60.2 | – | |||||||||||||||||||||||||
Pooled funds – Global real estate investment trusts | 40.4 | – | 40.4 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 58.2 | – | 58.2 | – | |||||||||||||||||||||||||
Pooled funds – International | 87.5 | – | 87.5 | – | |||||||||||||||||||||||||
Pooled funds – U.S. equities | 99.4 | – | 99.4 | – | |||||||||||||||||||||||||
Pooled funds – Alternative investments | 60.3 | – | – | 60.3 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total growth portfolio | 406.0 | – | 345.7 | 60.3 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets at fair value | $ | 778.8 | $ | 1.3 | $ | 717.2 | $ | 60.3 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (2) | 0.1 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets | $ | 778.9 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | "Pooled funds – International" excludes U.S. equity securities; "Pooled funds – Global equities" includes U.S. equity securities. | ||||||||||||||||||||||||||||
-2 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
The following table presents a reconciliation of Level 3 U.S. plan assets held during the year ended January 3, 2015: | |||||||||||||||||||||||||||||
Level 3 Assets | |||||||||||||||||||||||||||||
(In millions) | Pooled Funds – | ||||||||||||||||||||||||||||
Alternative | |||||||||||||||||||||||||||||
Investments | |||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at December 28, 2013 | $ | 51.2 | |||||||||||||||||||||||||||
Net realized and unrealized gain | 2.7 | ||||||||||||||||||||||||||||
Purchases | 6.4 | ||||||||||||||||||||||||||||
Settlements | – | ||||||||||||||||||||||||||||
Impact of changes in foreign currency exchange rates | – | ||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at January 3, 2015 | $ | 60.3 | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, international plan assets at fair value as of year-end 2014: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 0.6 | $ | 0.6 | $ | – | $ | – | |||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||
Mutual funds | 0.3 | 0.3 | – | – | |||||||||||||||||||||||||
Pooled funds – Emerging markets bonds | 6.7 | – | 6.7 | – | |||||||||||||||||||||||||
Pooled funds – European bonds | 243.5 | – | 243.5 | – | |||||||||||||||||||||||||
Pooled funds – U.K. bonds | 66.4 | – | 66.4 | – | |||||||||||||||||||||||||
Pooled funds – Global bonds | 3.4 | – | 3.4 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 6.5 | – | 6.5 | – | |||||||||||||||||||||||||
Pooled funds – Enhanced yield bonds | 1.9 | – | 1.9 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total fixed income securities | 328.7 | 0.3 | 328.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Pooled funds – Emerging markets | 22.3 | – | 22.3 | – | |||||||||||||||||||||||||
Pooled funds – U.K. | 16.2 | – | 16.2 | – | |||||||||||||||||||||||||
Pooled funds – Global | 160.2 | – | 160.2 | – | |||||||||||||||||||||||||
Pooled funds – Real estate investment trusts | 32.0 | – | 32.0 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total equity securities | 230.7 | – | 230.7 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other investments | |||||||||||||||||||||||||||||
Pooled funds – Commodities | 8.4 | – | 8.4 | – | |||||||||||||||||||||||||
Pooled funds – Real estate | 8.5 | – | 8.5 | – | |||||||||||||||||||||||||
Pooled funds – Other | 16.6 | – | 16.6 | – | |||||||||||||||||||||||||
Insurance contracts | 24.6 | – | – | 24.6 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total other investments | 58.1 | – | 33.5 | 24.6 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets at fair value | $ | 618.1 | $ | 0.9 | $ | 592.6 | $ | 24.6 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
The following table presents a reconciliation of Level 3 international plan assets held during the year ended January 3, 2015: | |||||||||||||||||||||||||||||
Level 3 Assets | |||||||||||||||||||||||||||||
(In millions) | Insurance Contracts | ||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at December 28, 2013 | $ | 27.4 | |||||||||||||||||||||||||||
Net realized and unrealized gain | 0.6 | ||||||||||||||||||||||||||||
Purchases | 2.3 | ||||||||||||||||||||||||||||
Settlements | (2.9 | ) | |||||||||||||||||||||||||||
Impact of changes in foreign currency exchange rates | (2.8 | ) | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at January 3, 2015 | $ | 24.6 | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, U.S. plan assets (all in the ADPP) at fair value as of year-end 2013: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 15.8 | $ | 15.8 | $ | – | $ | – | |||||||||||||||||||||
Liability hedging portfolio | |||||||||||||||||||||||||||||
Pooled funds – Corporate debt/agencies | 332.7 | – | 332.7 | – | |||||||||||||||||||||||||
Pooled funds – U.S. bonds, other fixed income | 0.4 | – | 0.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total liability hedging portfolio | 333.1 | – | 333.1 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Growth portfolio (1) | |||||||||||||||||||||||||||||
Pooled funds – Global equities | 60.0 | – | 60.0 | – | |||||||||||||||||||||||||
Pooled funds – Global real estate investment trusts | 45.8 | – | 45.8 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 65.2 | – | 65.2 | – | |||||||||||||||||||||||||
Pooled funds – International | 86.6 | – | 86.6 | – | |||||||||||||||||||||||||
Pooled funds – U.S. equities | 89.5 | – | 89.5 | – | |||||||||||||||||||||||||
Pooled funds – Alternative investments | 51.2 | – | – | 51.2 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total growth portfolio | 398.3 | – | 347.1 | 51.2 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets at fair value | $ | 747.2 | $ | 15.8 | $ | 680.2 | $ | 51.2 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (2) | 0.2 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets | $ | 747.4 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | "Pooled funds – International" excludes U.S. equity securities; "Pooled funds – Global equities" includes U.S. equity securities. | ||||||||||||||||||||||||||||
-2 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, international plan assets at fair value as of year-end 2013: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 4.7 | $ | 4.7 | $ | – | $ | – | |||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||
Mutual funds | 0.3 | 0.3 | – | – | |||||||||||||||||||||||||
Pooled funds – Emerging markets bonds | 6.2 | – | 6.2 | – | |||||||||||||||||||||||||
Pooled funds – European bonds | 193.8 | – | 193.8 | – | |||||||||||||||||||||||||
Pooled funds – U.K. bonds | 56.6 | – | 56.6 | – | |||||||||||||||||||||||||
Pooled funds – Global bonds | 3.3 | – | 3.3 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 6.7 | – | 6.7 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total fixed income securities | 266.9 | 0.3 | 266.6 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Pooled funds – Emerging markets | 20.9 | – | 20.9 | – | |||||||||||||||||||||||||
Pooled funds – U.K. | 17.2 | – | 17.2 | – | |||||||||||||||||||||||||
Pooled funds – Global | 151.3 | – | 151.3 | – | |||||||||||||||||||||||||
Pooled funds – Real estate investment trusts | 28.8 | – | 28.8 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total equity securities | 218.2 | – | 218.2 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other investments | |||||||||||||||||||||||||||||
Pooled funds – Commodities | 9.5 | – | 9.5 | – | |||||||||||||||||||||||||
Pooled funds – Real estate | 7.7 | – | 7.7 | – | |||||||||||||||||||||||||
Pooled funds – Other | 31.7 | – | 31.7 | – | |||||||||||||||||||||||||
Insurance contracts | 27.4 | – | – | 27.4 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total other investments | 76.3 | – | 48.9 | 27.4 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets at fair value | $ | 566.1 | $ | 5.0 | $ | 533.7 | $ | 27.4 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (1) | 0.5 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets | $ | 566.6 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
Postretirement Health Benefits | |||||||||||||||||||||||||||||
We provide postretirement health benefits to certain U.S. retired employees up to the age of 65 under a cost-sharing arrangement and provide supplemental Medicare benefits to certain U.S. retirees over the age of 65. Our policy is to fund the cost of the postretirement benefits from operating cash flows. While we have not expressed any intent to terminate postretirement health benefits, we may do so at any time, subject to applicable laws and regulations. | |||||||||||||||||||||||||||||
Plan Assumptions | |||||||||||||||||||||||||||||
Discount Rate | |||||||||||||||||||||||||||||
In consultation with our actuaries, we annually review and determine the discount rates to be used in connection with valuing our postretirement obligations. The assumed discount rate for each pension plan reflects market rates for high quality corporate bonds currently available. In the U.S., our discount rate is determined by evaluating yield curves consisting of large populations of high quality corporate bonds. The projected pension benefit payment streams are then matched with the bond portfolios to determine a rate that reflects the liability duration unique to our plans. | |||||||||||||||||||||||||||||
Long-term Return on Assets | |||||||||||||||||||||||||||||
We determine the long-term rate of return assumption for plan assets by reviewing the historical and expected returns of both the equity and fixed income markets, taking into account our asset allocation, the correlation between our asset classes, and the mix of active and passive investments. Additionally, current market conditions, including interest rates, are evaluated and market data is reviewed for reasonableness and appropriateness. | |||||||||||||||||||||||||||||
Healthcare Cost Trend Rate | |||||||||||||||||||||||||||||
Our practice is to fund the cost of postretirement benefits from operating cash flows. For measurement purposes, a 6.5% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2015. This rate is expected to decrease to approximately 5% by 2018. | |||||||||||||||||||||||||||||
A one-percentage-point change in assumed health care cost trend rates would have the following effects: | |||||||||||||||||||||||||||||
(In millions) | One-percentage-point | One-percentage-point | |||||||||||||||||||||||||||
Increase | Decrease | ||||||||||||||||||||||||||||
Effect on total of service and interest cost components | $ | 0.01 | $ | (.01 | ) | ||||||||||||||||||||||||
Effect on postretirement benefit obligations | 0.4 | (.4 | ) | ||||||||||||||||||||||||||
| | | | | | | | ||||||||||||||||||||||
Plan Balance Sheet Reconciliations | |||||||||||||||||||||||||||||
The following table provides a reconciliation of benefit obligations, plan assets, funded status of the plans and accumulated other comprehensive loss for our defined benefit plans: | |||||||||||||||||||||||||||||
Plan Benefit Obligations | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Change in projected benefit obligations | |||||||||||||||||||||||||||||
Projected benefit obligations at beginning of year | $ | 933.7 | $ | 642.8 | $ | 963.7 | $ | 597.6 | $ | 9.1 | $ | 12 | |||||||||||||||||
Service cost | 0.4 | 12.9 | 0.4 | 13 | – | – | |||||||||||||||||||||||
Interest cost | 44.7 | 23.8 | 39.7 | 23.3 | 0.3 | 0.3 | |||||||||||||||||||||||
Participant contribution | – | 4 | – | 4.1 | 1.1 | 1.2 | |||||||||||||||||||||||
Amendments (1) | – | (7.2 | ) | 19.9 | – | – | – | ||||||||||||||||||||||
Actuarial loss (gain) (2) | 141.5 | 166.1 | (59.8 | ) | 8.5 | 0.3 | (.5 | ) | |||||||||||||||||||||
Plan transfers (3) | 21.4 | – | 5.7 | 7.1 | – | – | |||||||||||||||||||||||
Benefits paid | (47.9 | ) | (22.3 | ) | (45.4 | ) | (21.2 | ) | (2.8 | ) | (3.5 | ) | |||||||||||||||||
Curtailments | – | (7.6 | ) | 9.5 | (1.7 | ) | – | (.4 | ) | ||||||||||||||||||||
Settlements | – | (2.2 | ) | – | (6.0 | ) | – | – | |||||||||||||||||||||
Foreign currency translation | – | (73.2 | ) | – | 18.1 | – | – | ||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Projected benefit obligations at end of year | $ | 1,093.80 | $ | 737.1 | $ | 933.7 | $ | 642.8 | $ | 8 | $ | 9.1 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Accumulated benefit obligations at end of year | $ | 1,093.80 | $ | 693.9 | $ | 933.7 | $ | 601.7 | |||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
-1 | Amendments to the international plans in 2014 related to our plans in The Netherlands, U.K. and France. Amendments to the U.S. pension plan in 2013 primarily related to changing the timing for the required benefit elections for participant SHARE Accounts. | ||||||||||||||||||||||||||||
-2 | Actuarial loss (gain) in 2013 included an out-of-period adjustment of $15 million recorded in the fourth quarter of 2013 to properly state the balance sheet pension liability by increasing the projected benefit obligation as a result of a change in the method for projecting SHARE Account asset values. The corresponding adjustment affected other comprehensive income, with no impact to net income in 2013, and is subject to future amortization. The impact of this out-of-period adjustment was not considered material to the 2013 or any previous financial statements. | ||||||||||||||||||||||||||||
-3 | Plan transfers in 2014 and 2013 for the U.S. represented transfers from participant SHARE Accounts. Plan transfers in 2013 for the international plans include transfers in Switzerland and Germany related to the OCP and DES divestitures. | ||||||||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Change in plan assets | |||||||||||||||||||||||||||||
Plan assets at beginning of year | $ | 747.4 | $ | 566.6 | $ | 648.5 | $ | 515 | $ | – | $ | – | |||||||||||||||||
Actual return on plan assets | 52.9 | 117.9 | 61.8 | 26.6 | – | – | |||||||||||||||||||||||
Plan transfers (1) | 21.4 | – | 5.7 | 2.3 | – | – | |||||||||||||||||||||||
Employer contributions | 5.1 | 16 | 76.8 | 28.9 | 1.7 | 2.3 | |||||||||||||||||||||||
Participant contributions | – | 4 | – | 4.1 | 1.1 | 1.2 | |||||||||||||||||||||||
Benefits paid | (47.9 | ) | (22.3 | ) | (45.4 | ) | (21.2 | ) | (2.8 | ) | (3.5 | ) | |||||||||||||||||
Settlements | – | (2.2 | ) | – | (6.0 | ) | – | – | |||||||||||||||||||||
Foreign currency translation | – | (61.9 | ) | – | 16.9 | – | – | ||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Plan assets at end of year | $ | 778.9 | $ | 618.1 | $ | 747.4 | $ | 566.6 | $ | – | $ | – | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
-1 | Plan transfers in 2014 and 2013 for the U.S. represented transfers from participant SHARE Accounts. Plan transfers in 2013 for the international plans include transfers in Switzerland related to the OCP and DES divestitures. | ||||||||||||||||||||||||||||
Funded Status | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Funded status of the plans | |||||||||||||||||||||||||||||
Other assets | $ | – | $ | 20 | $ | – | $ | 35.4 | $ | – | $ | – | |||||||||||||||||
Other accrued liabilities | (4.1 | ) | (2.5 | ) | (3.6 | ) | (2.7 | ) | (1.6 | ) | (2.2 | ) | |||||||||||||||||
Long-term retirement benefits and other liabilities | (310.8 | ) | (136.5 | ) | (182.7 | ) | (108.9 | ) | (6.4 | ) | (6.9 | ) | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Plan assets less than benefit obligations | $ | (314.9 | ) | $ | (119.0 | ) | $ | (186.3 | ) | $ | (76.2 | ) | $ | (8.0 | ) | $ | (9.1 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | ||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted-average assumptions used to determine year-end benefit obligations | |||||||||||||||||||||||||||||
Discount rate | 4.00 | % | 2.54 | % | 4.85 | % | 3.88 | % | 4.00 | % | 3.94 | % | 3.50 | % | 3.45 | % | 2.85 | % | |||||||||||
Compensation rate increase | – | 2.22 | – | 2.24 | – | 2.24 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The amount in non-current pension assets represents the net assets of our overfunded plans, which consist of a few international plans. The amounts in current and non-current pension liabilities represent the net obligations of our underfunded plans, which consist of all U.S. and several international plans. | |||||||||||||||||||||||||||||
For U.S. and international plans combined, the projected benefit obligations and fair value of plan assets for pension plans with projected benefit obligations in excess of plan assets were $1.45 billion and $997.3 million, respectively, at year-end 2014 and $1.25 billion and $953.7 million, respectively, at year-end 2013. | |||||||||||||||||||||||||||||
For U.S. and international plans combined, the accumulated benefit obligations and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were $1.43 billion and $997.3 million, respectively, at year-end 2014 and $1.22 billion and $938.6 million, respectively, at year-end 2013. | |||||||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||||||||||||||||
The following table sets forth the pretax amounts recognized in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets: | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Net actuarial loss | $ | 590.5 | $ | 174.8 | $ | 466.9 | $ | 129.5 | $ | 24.1 | $ | 26.6 | |||||||||||||||||
Prior service cost (credit) | 19.9 | (5.3 | ) | 21 | 2.5 | (22.9 | ) | (26.2 | ) | ||||||||||||||||||||
Net transition obligation | – | 0.4 | – | 0.5 | – | – | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Net amount recognized in accumulated other comprehensive loss | $ | 610.4 | $ | 169.9 | $ | 487.9 | $ | 132.5 | $ | 1.2 | $ | 0.4 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
The following table sets forth the pretax amounts, including those of discontinued operations, recognized in "Other comprehensive loss (income)": | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net actuarial loss (gain) | $ | 140.6 | $ | 51.3 | $ | (73.4 | ) | $ | 6.1 | $ | 93.5 | $ | 16.4 | $ | 0.3 | $ | (.9 | ) | $ | 1.7 | |||||||||
Prior service (credit) cost | – | (7.3 | ) | 19.9 | – | – | – | – | – | – | |||||||||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||||||||
Net actuarial loss | (16.8 | ) | (5.6 | ) | (18.6 | ) | (8.0 | ) | (14.9 | ) | (3.3 | ) | (2.8 | ) | (2.5 | ) | (2.7 | ) | |||||||||||
Prior service (cost) credit | (1.2 | ) | (1.0 | ) | (.3 | ) | (.4 | ) | (.4 | ) | (.5 | ) | 3.3 | 17.2 | 4.8 | ||||||||||||||
Net transition asset | – | – | – | 0.1 | – | 0.5 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net amount recognized in other comprehensive loss (income) | $ | 122.6 | $ | 37.4 | $ | (72.4 | ) | $ | (2.2 | ) | $ | 78.2 | $ | 13.1 | $ | 0.8 | $ | 13.8 | $ | 3.8 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Plan Income Statement Reconciliations | |||||||||||||||||||||||||||||
The following table sets forth the components of net periodic benefit cost, which are recorded in income from continuing operations, for our defined benefit plans: | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Service cost | $ | 0.4 | $ | 12.9 | $ | 0.4 | $ | 13 | $ | 0.3 | $ | 9.1 | $ | – | $ | – | $ | – | |||||||||||
Interest cost | 44.7 | 23.8 | 39.7 | 23.3 | 40.3 | 24.5 | 0.3 | 0.3 | 0.5 | ||||||||||||||||||||
Expected return on plan assets | (52.0 | ) | (26.0 | ) | (48.1 | ) | (22.6 | ) | (45.9 | ) | (22.1 | ) | – | – | – | ||||||||||||||
Recognized actuarial loss | 16.2 | 5.2 | 17.7 | 6.3 | 14.3 | 3.1 | 2.8 | 2.5 | 2.7 | ||||||||||||||||||||
Amortization of prior service cost (credit) | 1.2 | 0.4 | 0.3 | 0.5 | 0.4 | 0.4 | (3.3 | ) | (4.1 | ) | (4.8 | ) | |||||||||||||||||
Amortization of transition asset | – | – | – | (.1 | ) | – | (.5 | ) | – | – | – | ||||||||||||||||||
Recognized loss (gain) on curtailment (1) | – | 0.6 | – | (1.5 | ) | – | – | – | – | – | |||||||||||||||||||
Recognized loss on settlement (2) | 0.6 | 0.4 | – | 0.5 | 0.6 | – | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net periodic benefit cost (credit) | $ | 11.1 | $ | 17.3 | $ | 10 | $ | 19.4 | $ | 10 | $ | 14.5 | $ | (.2 | ) | $ | (1.3 | ) | $ | (1.6 | ) | ||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
-1 | Recognized loss on curtailment in 2014 related to a pension plan in The Netherlands and gain on curtailment in 2013 related to a pension plan in Taiwan. These amounts were recorded in "Other expense, net" in the Consolidated Statements of Income. | ||||||||||||||||||||||||||||
-2 | Represented settlement event in Switzerland in 2014. | ||||||||||||||||||||||||||||
In 2013, in connection with the sale of our former OCP and DES businesses, we recognized a curtailment gain of $13.1 million associated with our U.S. postretirement health benefit plan, partially offset by curtailment and settlement losses of $10.4 million associated with certain U.S. pension plans. The net gain of $2.7 million was recorded in "Income (loss) from discontinued operations, net of tax" in the Consolidated Statements of Income. Refer to Note 2, "Discontinued Operations and Sale of Assets," for more information on the sale. | |||||||||||||||||||||||||||||
The following table sets forth the weighted-average assumptions used to determine net periodic cost: | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | ||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Discount rate | 4.85 | % | 3.88 | % | 4.00 | % | 3.94 | % | 4.75 | % | 4.80 | % | 3.45 | % | 2.85 | % | 3.75 | % | |||||||||||
Expected return on assets | 7.75 | 4.82 | 8.00 | 4.78 | 8.00 | 4.95 | – | – | – | ||||||||||||||||||||
Compensation rate increase | – | 2.24 | – | 2.24 | – | 2.79 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Plan Contributions | |||||||||||||||||||||||||||||
We make contributions to our defined benefit plans sufficient to meet the minimum funding requirements of applicable laws and regulations, plus additional amounts, if any, we determine to be appropriate. In 2015, we expect to contribute approximately $15 million, $4 million, and $2 million to our international pension plans, U.S. pension plans, and postretirement benefit plan, respectively. | |||||||||||||||||||||||||||||
Future Benefit Payments | |||||||||||||||||||||||||||||
Anticipated future benefit payments, which reflect expected service periods for eligible participants, are as follows: | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | |||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
2015 | $ | 49.4 | $ | 18.4 | $ | 1.6 | |||||||||||||||||||||||
2016 | 50.1 | 19.3 | 1.2 | ||||||||||||||||||||||||||
2017 | 52.2 | 19.8 | 0.9 | ||||||||||||||||||||||||||
2018 | 68.4 | 20.1 | 0.6 | ||||||||||||||||||||||||||
2019 | 58.2 | 21.1 | 0.5 | ||||||||||||||||||||||||||
2020 –2023 | 294.5 | 119.2 | 1.6 | ||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Estimated Amortization Amounts in Accumulated Other Comprehensive Loss | |||||||||||||||||||||||||||||
Our estimates of fiscal year 2015 amortization of amounts included in "Accumulated other comprehensive loss" are as follows: | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | |||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Net actuarial loss | $ | 20.3 | $ | 10.4 | $ | 2.6 | |||||||||||||||||||||||
Prior service cost (credit) | 1.1 | (.3 | ) | (3.3 | ) | ||||||||||||||||||||||||
Net transition obligation | – | 0.1 | – | ||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Net loss (gain) to be recognized | $ | 21.4 | $ | 10.2 | $ | (.7 | ) | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Defined Contribution Plans | |||||||||||||||||||||||||||||
We sponsor various defined contribution plans worldwide, the largest of which is the Avery Dennison Corporation Employee Savings Plan ("Savings Plan"), a 401(k) plan for our U.S. employees. | |||||||||||||||||||||||||||||
We recognized expense from continuing operations of $19.4 million, $21 million, and $19.8 million in 2014, 2013, and 2012, respectively, related to our employer contributions and employer match of participant contributions to the Savings Plan. | |||||||||||||||||||||||||||||
Other Retirement Plans | |||||||||||||||||||||||||||||
We have deferred compensation plans which permit eligible employees and directors to defer a portion of their compensation. The compensation voluntarily deferred by the participant, together with certain employer contributions, earn specified and variable rates of return. As of year-end 2014 and 2013, we had accrued $125.2 million and $128.6 million, respectively, for our obligations under these plans. These obligations are funded by corporate-owned life insurance contracts and standby letters of credit. As of year-end 2014 and 2013, these obligations were secured by standby letters of credit of $2.5 million and $3 million, respectively. Proceeds from the insurance policies are payable to us upon the death of covered participants. The cash surrender values of these policies, net of outstanding loans, which are included in "Other assets" in the Consolidated Balance Sheets, were $210.9 million and $204.6 million at year-end 2014 and 2013, respectively. | |||||||||||||||||||||||||||||
Our deferred compensation expense from continuing operations was $6.8 million, $5.9 million, and $7.1 million for 2014, 2013, and 2012, respectively. A portion of the interest on certain of our contributions may be forfeited by participants if their employment terminates before age 55 other than by reason of death or disability. | |||||||||||||||||||||||||||||
Our Directors Deferred Equity Compensation Plan allows our non-employee directors to elect to receive their cash compensation in deferred stock units ("DSUs") issued under our stock option and incentive plan. Dividend equivalents, representing the value of dividends per share paid on shares of our common stock and calculated with reference to the number of DSUs held as of a quarterly dividend record date, are credited in the form of additional DSUs on the applicable payable date. A director's DSUs are converted into shares of our common stock upon his or her resignation or retirement. Approximately .1 million DSUs were outstanding as of year-end 2014 and 2013, with an aggregate value of $6.1 million and $5.5 million, respectively. | |||||||||||||||||||||||||||||
COMMITMENTS
COMMITMENTS | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Commitments and Contingencies | |||||
COMMITMENTS | NOTE 7. COMMITMENTS | ||||
Minimum annual rental commitments on operating leases having initial or remaining non-cancelable lease terms of one year or more are as follows: | |||||
Year | (In millions) | ||||
| | | | | |
2015 | $ | 50.9 | |||
2016 | 37.4 | ||||
2017 | 22.3 | ||||
2018 | 13.6 | ||||
2019 | 10.3 | ||||
2020 and thereafter | 39.3 | ||||
| | | | | |
Total minimum lease payments | $ | 173.8 | |||
| | | | | |
Rent expense for operating leases from continuing operations, which includes maintenance and insurance costs and property taxes, was approximately $67 million in 2014, $70 million in 2013, and $75 million in 2012. Operating leases relate primarily to office and warehouse space, and equipment for electronic data processing and transportation. The terms of these leases do not impose significant restrictions or unusual obligations, except as noted below. | |||||
On September 9, 2005, we completed a ten-year lease financing for a commercial facility located in Mentor, Ohio used primarily for the North American headquarters and research center of our Materials group. The facility consists generally of land, buildings, and equipment. We lease the facility under an operating lease arrangement, which contains a residual value guarantee of $31.5 million, as well as certain obligations with respect to the refinancing of the lessor's debt of $11.5 million (collectively, the "Guarantee"). At the end of the lease term, we have the option to purchase or remarket the facility at an amount equivalent to the value of the Guarantee. If our estimated fair value (or estimated selling price) of the facility falls below the Guarantee, we would be required to pay the lessor a shortfall, which is an amount equivalent to the Guarantee less our estimated fair value. During the second quarter of 2011, we estimated a shortfall with respect to the Guarantee and began to recognize the shortfall on a straight-line basis over the remaining lease term. The carrying amount of the shortfall was approximately $16 million at January 3, 2015, which was included in "Other accrued liabilities" in the Consolidated Balance Sheets. | |||||
Refer to Note 4, "Debt and Capital Leases," for information on capital lease obligations. | |||||
CONTINGENCIES
CONTINGENCIES | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
CONTINGENCIES | ||||||||
CONTINGENCIES | NOTE 8. CONTINGENCIES | |||||||
Legal Proceedings | ||||||||
We are involved in various lawsuits, claims, inquiries, and other regulatory and compliance matters, most of which are routine to the nature of our business. We have accrued liabilities for matters where it is probable that a loss will be incurred and the amount of loss can be reasonably estimated. Because of the uncertainties associated with claims resolution and litigation, future expenses to resolve these matters could be higher than the liabilities we have accrued; however, we are unable to reasonably estimate a range of potential expenses. If information were to become available that allowed us to reasonably estimate the range of potential expenses in an amount higher or lower than what we have accrued, we would adjust our accrued liabilities accordingly. Additional lawsuits, claims, inquiries, and other regulatory and compliance matters could arise in the future. The range of expenses for resolving any future matters would be assessed as they arise; until then, a range of potential expenses for such resolution cannot be determined. Potential insurance reimbursements are not offset against potential liabilities, and such liabilities are not discounted. Based upon current information, we believe that the impact of the resolution of these matters would not be, individually or in the aggregate, material to our financial position, results of operations or cash flows. | ||||||||
Environmental | ||||||||
Environmental expenditures are generally expensed. However, environmental expenditures for newly acquired assets and those which extend or improve the economic useful life of existing assets are capitalized and amortized over the shorter of the estimated useful life of the acquired asset or the remaining life of the existing asset. We review our estimates of costs of compliance with environmental laws related to remediation and cleanup of various sites, including sites in which governmental agencies have designated us as a potentially responsible party. When it is probable that a loss will be incurred and where a range of the loss can be reasonably estimated, the best estimate within the range is accrued. When the best estimate within the range cannot be determined, the low end of the range is accrued. Potential insurance reimbursements are not offset against potential liabilities, and such liabilities are not discounted. | ||||||||
As of January 3, 2015, we have been designated by the U.S. Environmental Protection Agency ("EPA") and/or other responsible state agencies as a potentially responsible party ("PRP") at fourteen waste disposal or waste recycling sites, which are the subject of separate investigations or proceedings concerning alleged soil and/or groundwater contamination and for which no settlement of our liability has been agreed. We are participating with other PRPs at these sites, and anticipate that our share of remediation costs will be determined pursuant to agreements entered into in the normal course of negotiations with the EPA or other governmental authorities. | ||||||||
We have accrued liabilities for sites where it is probable that a loss will be incurred and the cost or amount of loss can be reasonably estimated. These estimates could change as a result of changes in planned remedial actions, remediation technologies, site conditions, the estimated time to complete remediation, environmental laws and regulations, and other factors. Because of the uncertainties associated with environmental assessment and remediation activities, future expenses to remediate these sites could be higher than the liabilities we have accrued; however, we are unable to reasonably estimate a range of potential expenses. If information were to become available that allowed us to reasonably estimate the range of potential expenses in an amount higher or lower than what we have accrued, we would adjust our environmental liabilities accordingly. In addition, we may be identified as a PRP at additional sites in the future. The range of expenses for remediation of any future-identified sites would be addressed as they arise; until then, a range of expenses for such remediation cannot be determined. | ||||||||
The activity in 2014 and 2013 related to environmental liabilities was as follows: | ||||||||
(In millions) | 2014 | 2013 | ||||||
| | | | | | | | |
Balance at beginning of year | $ | 29.6 | $ | 32.5 | ||||
Charges (reversals), net | 1.7 | 4.6 | ||||||
Payments | (5.1 | ) | (7.5 | ) | ||||
| | | | | | | | |
Balance at end of year | $ | 26.2 | $ | 29.6 | ||||
| | | | | | | | |
As of January 3, 2015, approximately $10 million of the balance was classified as short-term and included in "Other accrued liabilities" in the Consolidated Balance Sheets. | ||||||||
Guarantees | ||||||||
We participate in receivable financing programs with several financial institutions whereby advances may be requested from these financial institutions. We guarantee the collection of the related receivables. At January 3, 2015, the outstanding amount guaranteed was approximately $17 million. We believe our exposure to these guarantees is not material. | ||||||||
Unused letters of credit (primarily standby) outstanding with various financial institutions were approximately $53 million at January 3, 2015. | ||||||||
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Fair Value Measurements | ||||||||||||||
FAIR VALUE MEASUREMENTS | NOTE 9. FAIR VALUE MEASUREMENTS | |||||||||||||
Recurring Fair Value Measurements | ||||||||||||||
The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of January 3, 2015: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | ||||||||||
Prices | Other | Other | ||||||||||||
in Active | Observable | Unobservable | ||||||||||||
Markets | Inputs | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
| | | | | | | | | | | | | | |
Assets | ||||||||||||||
Trading securities | $ | 17.9 | $ | 7.6 | $ | 10.3 | $ | – | ||||||
Derivative assets | 10.3 | – | 10.3 | – | ||||||||||
Liabilities | ||||||||||||||
Derivative liabilities | $ | 11.7 | $ | 1.2 | $ | 10.5 | $ | – | ||||||
| | | | | | | | | | | | | | |
The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of December 28, 2013: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | ||||||||||
Prices | Other | Other | ||||||||||||
in Active | Observable | Unobservable | ||||||||||||
Markets | Inputs | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
| | | | | | | | | | | | | | |
Assets | ||||||||||||||
Trading securities | $ | 17.7 | $ | 7.6 | $ | 10.1 | $ | – | ||||||
Short-term investments | 114.5 | – | 114.5 | – | ||||||||||
Derivative assets | 3.2 | 0.1 | 3.1 | – | ||||||||||
Liabilities | ||||||||||||||
Derivative liabilities | $ | 4.7 | $ | – | $ | 4.7 | $ | – | ||||||
| | | | | | | | | | | | | | |
Trading securities include fixed income securities (primarily U.S. government and corporate debt securities) measured at fair value using quoted prices/bids and a money market fund measured at fair value using net asset value. As of January 3, 2015, trading securities of $.8 million and $17.1 million were included in "Cash and cash equivalents" and "Other current assets," respectively, in the Consolidated Balance Sheets. As of December 28, 2013, trading securities of $.3 million and $17.4 million were included in "Cash and cash equivalents" and "Other current assets," respectively, in the Consolidated Balance Sheets. Short-term investments are comprised of commercial paper and measured at fair value using broker quoted prices. As of December 28, 2013, short-term investments were included in "Cash and cash equivalents." Derivatives that are exchange-traded are measured at fair value using quoted market prices and classified within Level 1 of the valuation hierarchy. Derivatives measured based on inputs that are readily available in public markets are classified within Level 2 of the valuation hierarchy. | ||||||||||||||
Non-recurring Fair Value Measurements | ||||||||||||||
During 2013, long-lived assets with carrying amounts totaling $8.3 million were written down to their fair value of $4.8 million, resulting in an impairment charge of $3.5 million, which was included in "Other expense, net" in the Consolidated Statements of Income. The fair value was based on the sale price of the assets, less estimated broker fees, which are primarily Level 3 inputs. | ||||||||||||||
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 12 Months Ended | ||||||||||||
Jan. 03, 2015 | |||||||||||||
Net Income Per Share | |||||||||||||
NET INCOME PER SHARE | NOTE 10. NET INCOME PER SHARE | ||||||||||||
Net income per common share was computed as follows: | |||||||||||||
(In millions, except per share amounts) | 2014 | 2013 | 2012 | ||||||||||
| | | | | | | | | | | | | |
(A) | Income from continuing operations | $ | 251.1 | $ | 244.3 | $ | 157.6 | ||||||
(B) | (Loss) income from discontinued operations, net of tax | (2.2 | ) | (28.5 | ) | 57.8 | |||||||
| | | | | | | | | | | | | |
(C) | Net income available to common shareholders | $ | 248.9 | $ | 215.8 | $ | 215.4 | ||||||
| | | | | | | | | | | | | |
(D) | Weighted-average number of common shares outstanding | 93.8 | 98.4 | 102.6 | |||||||||
| | | | | | | | | | | | | |
Dilutive shares (additional common shares issuable under stock-based awards) | 1.9 | 1.7 | 0.9 | ||||||||||
| | | | | | | | | | | | | |
(E) | Weighted-average number of common shares outstanding, assuming dilution | 95.7 | 100.1 | 103.5 | |||||||||
| | | | | | | | | | | | | |
Net income (loss) per common share: | |||||||||||||
Continuing operations (A) ÷ (D) | $ | 2.68 | $ | 2.48 | $ | 1.54 | |||||||
Discontinued operations (B) ÷ (D) | (.03 | ) | (.29 | ) | 0.56 | ||||||||
| | | | | | | | | | | | | |
Net income per common share | $ | 2.65 | $ | 2.19 | $ | 2.1 | |||||||
(C) ÷ (D) | |||||||||||||
| | | | | | | | | | | | | |
Net income (loss) per common share, assuming dilution: | |||||||||||||
Continuing operations (A) ÷ (E) | $ | 2.62 | $ | 2.44 | $ | 1.52 | |||||||
Discontinued operations (B) ÷ (E) | (.02 | ) | (.28 | ) | 0.56 | ||||||||
| | | | | | | | | | | | | |
Net income per common share, | $ | 2.6 | $ | 2.16 | $ | 2.08 | |||||||
assuming dilution (C) ÷ (E) | |||||||||||||
| | | | | | | | | | | | | |
Certain stock-based compensation awards were not included in the computation of net income per common share, assuming dilution, because they would not have had a dilutive effect. Stock-based compensation awards excluded from the computation totaled approximately 3 million shares in 2014, 7 million shares in 2013, and 12 million shares in 2012. | |||||||||||||
SUPPLEMENTAL_EQUITY_AND_COMPRE
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
SHAREHOLDERS' EQUITY | ||||||||||||||
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION | NOTE 11. SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION | |||||||||||||
Common Stock and Share Repurchase Program | ||||||||||||||
Our Certificate of Incorporation authorizes five million shares of $1 par value preferred stock (none outstanding), with respect to which our Board of Directors may fix the series and terms of issuance, and 400 million shares of $1 par value voting common stock. | ||||||||||||||
From time to time, our Board of Directors authorizes us to repurchase of shares of our outstanding common stock. Repurchased shares may be reissued under our stock option and incentive plan or used for other corporate purposes. In 2014, we repurchased approximately 7.4 million shares of our common stock at an aggregate cost of $355.5 million. | ||||||||||||||
On December 4, 2014, our Board of Directors authorized the repurchase of shares of our common stock in the aggregate amount of up to $500 million (exclusive of any fees, commissions or other expenses related to such purchases), in addition to any outstanding shares authorized under any previous Board authorization. This authorization will remain in effect until the shares authorized thereby have been repurchased. | ||||||||||||||
On July 25, 2013, our Board of Directors authorized the repurchase of shares of our common stock in the aggregate amount of up to $400 million (exclusive of any fees, commissions or other expenses related to such purchases), in addition to any outstanding shares authorized under any previous Board authorization. This authorization will remain in effect until the shares authorized thereby have been repurchased. | ||||||||||||||
As of January 3, 2015, shares of our common stock in the aggregate amount of approximately $600 million remained authorized for repurchase under both Board authorizations. | ||||||||||||||
Treasury Shares Reissuance | ||||||||||||||
We fund a portion of our employee-related expenses using shares of our common stock held in treasury. We elected to record net gains or losses associated with our use of treasury shares to retained earnings. | ||||||||||||||
Comprehensive Income | ||||||||||||||
Comprehensive income, net of tax, includes net income, foreign currency translation adjustment, net actuarial loss, prior service cost and net transition assets, and the gains or losses on the effective portion of cash flow and firm commitment hedges that are currently presented as a component of shareholders' equity. | ||||||||||||||
The changes in "Accumulated other comprehensive loss" (net of tax) for 2014 and 2013 were as follows: | ||||||||||||||
(In millions) | Foreign | Pension and | Cash Flow | Total | ||||||||||
Currency | Other | Hedges | ||||||||||||
Translation | Postretirement | |||||||||||||
Benefits | ||||||||||||||
| | | | | | | | | | | | | | |
Balance as of December 29, 2012 | $ | 180.5 | $ | (456.5 | ) | $ | (2.0 | ) | $ | (278.0 | ) | |||
Other comprehensive income (loss) before reclassifications, net of tax | (53.3 | ) | 29.4 | 0.8 | (23.1 | ) | ||||||||
Reclassifications to net income, net of tax | 10.8 | 9 | 0.2 | 20 | ||||||||||
| | | | | | | | | | | | | | |
Net current-period other comprehensive income (loss), net of tax | (42.5 | ) | 38.4 | 1 | (3.1 | ) | ||||||||
| | | | | | | | | | | | | | |
Balance as of December 28, 2013 | $ | 138 | $ | (418.1 | ) | $ | (1.0 | ) | $ | (281.1 | ) | |||
Other comprehensive income (loss) before reclassifications, net of tax | (154.7 | ) | (129.4 | ) | 0.1 | (284.0 | ) | |||||||
Reclassifications to net income, net of tax | – | 16.9 | 0.9 | 17.8 | ||||||||||
| | | | | | | | | | | | | | |
Net current-period other comprehensive income (loss), net of tax | (154.7 | ) | (112.5 | ) | 1 | (266.2 | ) | |||||||
| | | | | | | | | | | | | | |
Balance as of January 3, 2015 | $ | (16.7 | ) | $ | (530.6 | ) | $ | – | $ | (547.3 | ) | |||
| | | | | | | | | | | | | | |
The amounts reclassified from "Accumulated other comprehensive loss" to increase (decrease) income from continuing operations were as follows: | ||||||||||||||
(In millions) | 2014 | 2013 | Affected Line Item in the | |||||||||||
Statement Where Net | ||||||||||||||
Income is Presented | ||||||||||||||
| | | | | | | | | ||||||
Cash flow hedges: | ||||||||||||||
Foreign exchange contracts | $ | (1.2 | ) | $ | 0.6 | Cost of products sold | ||||||||
Commodity contracts | 0.1 | (1.2 | ) | Cost of products sold | ||||||||||
Interest rate contracts | (.1 | ) | (.1 | ) | Interest expense | |||||||||
| | | | | | | | | ||||||
(1.2 | ) | (.7 | ) | Total before tax | ||||||||||
0.3 | 0.2 | Provision for income taxes | ||||||||||||
| | | | | | | | | ||||||
(.9 | ) | (.5 | ) | Net of tax | ||||||||||
Pension and other postretirement benefits (1) | (24.1 | ) | (23.5 | ) | ||||||||||
7.2 | 7.8 | Provision for income taxes | ||||||||||||
| | | | | | | | | ||||||
(16.9 | ) | (15.7 | ) | Net of tax | ||||||||||
| | | | | | | | | ||||||
Total reclassifications for the period | $ | (17.8 | ) | $ | (16.2 | ) | Total, net of tax | |||||||
| | | | | | | | | ||||||
-1 | See Note 6, "Pension and Other Postretirement Benefits," for more information. | |||||||||||||
During 2013, we reclassified $6.4 million (net of tax) from "Accumulated other comprehensive loss" to "(Loss) income from discontinued operations, net of tax," related to a net gain from curtailment in our domestic defined benefit plans and settlements from certain international pension plans as a result of the sale of the OCP and DES businesses. Refer to Note 6, "Pension and Other Postretirement Benefits," for more information. | ||||||||||||||
Additionally, during 2013, we recognized $10.8 million (net of tax) of currency translation loss from "Accumulated other comprehensive loss" to "(Loss) income from discontinued operations, net of tax" as a result of the sale of the OCP and DES businesses. | ||||||||||||||
The following table sets forth the income tax (benefit) expense allocated to each component of other comprehensive (loss) income: | ||||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||||
| | | | | | | | | | | ||||
Foreign currency translation | $ | – | $ | – | $ | 0.9 | ||||||||
Pension and other postretirement benefits: | ||||||||||||||
Net actuarial (loss) gain | (56.6 | ) | 26.4 | (38.3 | ) | |||||||||
Prior service credit (cost) | 1.1 | (7.5 | ) | – | ||||||||||
Reclassifications to net income: | ||||||||||||||
Amortization of net actuarial loss | 7.5 | 9.4 | 6.9 | |||||||||||
Amortization of prior service credit | (.7 | ) | (1.3 | ) | (1.5 | ) | ||||||||
Amortization of transition asset | – | – | (.1 | ) | ||||||||||
Net curtailment of pension and post-retirement benefit obligations | 0.1 | (4.8 | ) | – | ||||||||||
Settlement of pension obligations | 0.3 | 0.6 | 0.2 | |||||||||||
Cash flow hedges: | ||||||||||||||
Losses (gains) recognized on cash flow hedges | 0.1 | 0.2 | (.7 | ) | ||||||||||
Reclassifications to net income | 0.3 | 0.1 | 3.7 | |||||||||||
| | | | | | | | | | | ||||
Income tax (benefit) expense related to items of other comprehensive (loss) income | $ | (47.9 | ) | $ | 23.1 | $ | (28.9 | ) | ||||||
| | | | | | | | | | | ||||
LONGTERM_INCENTIVE_COMPENSATIO
LONG-TERM INCENTIVE COMPENSATION | 12 Months Ended | |||||||||||
Jan. 03, 2015 | ||||||||||||
Long-Term Incentive Compensation | ||||||||||||
LONG-TERM INCENTIVE COMPENSATION | NOTE 12. LONG-TERM INCENTIVE COMPENSATION | |||||||||||
Equity Awards | ||||||||||||
Stock-Based Compensation | ||||||||||||
We maintain various stock option and incentive plans and grant our annual stock-based compensation awards to eligible employees in February and non-employee directors in May. Prior to 2013, these awards were granted to non-employee directors in April. Certain awards granted to retirement-eligible employees vest in full upon retirement; awards to these employees are accounted for as fully vested on the date of grant. | ||||||||||||
Stock-based compensation expense from continuing operations and the total recognized tax benefit related to this expense for the years 2014, 2013, and 2012 were as follows: | ||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||
| | | | | | | | | | | ||
Stock-based compensation expense | $ | 28.3 | $ | 32.3 | $ | 35.8 | ||||||
Tax benefit | 10.5 | 10.8 | 12.5 | |||||||||
| | | | | | | | | | | ||
This expense was included in "Marketing, general and administrative expense" in the Consolidated Statements of Income. | ||||||||||||
As of January 3, 2015, we had approximately $29 million of unrecognized compensation expense from continuing operations related to unvested stock-based awards, which is expected to be recognized over the remaining weighted-average requisite service period of approximately two years. | ||||||||||||
Stock Options | ||||||||||||
Stock options granted to non-employee directors and employees may be granted at no less than 100% of the fair market value of our common stock on the date of the grant. Options generally vest ratably over a three-year period for non-employee directors and over a four-year period for employees. Options expire ten years from the date of grant. | ||||||||||||
The fair value of stock option awards is estimated as of the date of grant using the Black-Scholes option-pricing model. This model requires input assumptions for our expected dividend yield, expected stock price volatility, risk-free interest rate and the expected option term. The following assumptions are used in estimating the fair value of granted stock options: | ||||||||||||
Risk-free interest rate is based on the 52-week average of the Treasury-Bond rate that has a term corresponding to the expected option term. | ||||||||||||
Expected stock price volatility represents an average of the implied and historical volatility. | ||||||||||||
Expected dividend yield is based on the current annual dividend divided by the 12-month average of our monthly stock price prior to grant. | ||||||||||||
Expected option term is determined based on historical experience under our stock option and incentive plans. | ||||||||||||
No stock options were granted during 2014. The weighted-average grant date fair value per share for stock options was $6.97 and $7.08 in 2013 and 2012, respectively. | ||||||||||||
The underlying weighted-average assumptions used were as follows: | ||||||||||||
2013 | 2012 | |||||||||||
| | | | | | | | |||||
Risk-free interest rate | 1.04 | % | 1.82 | % | ||||||||
Expected stock price volatility | 27.17 | % | 32.81 | % | ||||||||
Expected dividend yield | 3.40 | % | 3.30 | % | ||||||||
Expected option term | 6.2 years | 6.0 years | ||||||||||
| | | | | | | | |||||
The following table sets forth stock option information related to our stock option and incentive plan during 2014: | ||||||||||||
Number | Weighted-average | Weighted-average | Aggregate | |||||||||
of options | exercise price | remaining | intrinsic value | |||||||||
(in thousands) | contractual life | (in millions) | ||||||||||
(in years) | ||||||||||||
| | | | | | | | | | | | |
Outstanding at December 28, 2013 | 7,891.20 | $ | 45.85 | 4.27 | $ | 69 | ||||||
Exercised | (1,009.2 | ) | 34.14 | |||||||||
Forfeited or expired | (1,703.4 | ) | 58.17 | |||||||||
| | | | | | | | | | | | |
Outstanding at January 3, 2015 | 5,178.60 | $ | 44.08 | 3.95 | $ | 54.6 | ||||||
Options vested and expected to vest at January 3, 2015 | 5,134.50 | 44.19 | 3.95 | 53.7 | ||||||||
Options exercisable at January 3, 2015 | 4,444.20 | $ | 45.89 | 3.51 | $ | 40.9 | ||||||
| | | | | | | | | | | | |
The total intrinsic value of stock options exercised was $15.4 million in 2014, $26.1 million in 2013, and $3.8 million in 2012. We received approximately $34.2 million in 2014, $44.8 million in 2013, and $10.2 million in 2012 from the exercise of stock options. The tax benefit associated with these exercised options was $5.3 million in 2014, $8.5 million in 2013, and $1.3 million in 2012. The intrinsic value of the stock options is based on the amount by which the market value of the underlying stock exceeds the exercise price of the option. | ||||||||||||
Performance Units ("PUs") | ||||||||||||
PUs are performance-based awards granted under our stock option and incentive plan to eligible employees. PUs are payable in shares of our common stock at the end of a three-year cliff vesting period provided that certain performance objectives are achieved at the end of the period. Over the performance period, the estimated number of shares of our common stock issuable upon vesting is adjusted upward or downward based upon the probability of the achievement of the performance objectives established for the award. The actual number of shares issued can range from 0% to 200% of the target shares at the time of grant. The weighted-average grant date fair value for PUs was $47.85, $52.93 and $34.43 in 2014, 2013 and 2012, respectively. | ||||||||||||
The following table summarizes information related to awarded PUs: | ||||||||||||
Number of | Weighted- | |||||||||||
PUs | average | |||||||||||
(in thousands) | grant-date | |||||||||||
fair value | ||||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 795.2 | $ | 41.32 | |||||||||
Granted at target | 183.6 | 47.85 | ||||||||||
Forfeited/cancelled | (288.9 | ) | 41.59 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 689.9 | $ | 40.16 | |||||||||
| | | | | | | | |||||
In 2014, PUs granted during 2011 were cancelled as the performance objective was not met as of the end of the three-year performance period. The fair value of vested PUs was $9.8 million and $.3 million in 2013 and 2012, respectively. | ||||||||||||
Market-Leveraged Stock Units ("MSUs") | ||||||||||||
In 2013, we began granting performance-based MSUs under our stock option and incentive plan to certain eligible employees. These units vest ratably over a four-year period provided that the performance objective is achieved as of the end of each vesting period. MSUs accrue dividend equivalents during the vesting period, which are earned and paid only at vesting. The number of MSU shares earned is based upon our absolute total shareholder return at each vesting date and can range from 0% to 200% of the target amount of MSUs subject to vesting. Each of the four vesting periods represents one tranche of MSUs and the fair value of each of these four tranches was determined using the Monte-Carlo simulation model, which utilizes multiple input variables, including expected volatility and other assumptions, to estimate the probability of achieving the performance objective established for the award. The weighted-average grant date fair value for MSUs was $52.76 and $51.40 in 2014 and 2013, respectively. | ||||||||||||
The following table summarizes information related to awarded MSUs: | ||||||||||||
Number of | Weighted- | |||||||||||
MSUs | average | |||||||||||
(in thousands) | grant-date | |||||||||||
fair value | ||||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 330.1 | $ | 51.4 | |||||||||
Granted at target | 338.1 | 52.76 | ||||||||||
Adjustment for above-target performance (1) | 33.3 | 51.4 | ||||||||||
Vested | (109.6 | ) | 51.4 | |||||||||
Forfeited/cancelled | (40.1 | ) | 53.11 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 551.8 | $ | 52.18 | |||||||||
| | | | | | | | |||||
-1 | Reflects adjustment as a result of achieving above-target performance for vesting of the tranche paid out in 2014. | |||||||||||
Restricted Stock Units ("RSUs") | ||||||||||||
RSUs are service-based awards granted under our stock option and incentive plan to certain eligible employees that usually vest ratably over a period of three years for non-employee directors and four years for employees provided that directorship or employment continues through the applicable vesting date. If the condition is not met, unvested RSUs are generally forfeited. The weighted-average grant date fair value for RSUs was $45.91, $38.72 and $27.88 in 2014, 2013 and 2012, respectively. | ||||||||||||
The following table summarizes information related to awarded RSUs: | ||||||||||||
Number of RSUs (in thousands) | Weighted-average grant-date fair value | |||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 681 | $ | 31.06 | |||||||||
Granted | 48.9 | 45.91 | ||||||||||
Vested | (301.1 | ) | 31.41 | |||||||||
Forfeited/cancelled | (40.8 | ) | 31.53 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 388 | $ | 32.7 | |||||||||
| | | | | | | | |||||
The fair value of vested RSUs was $9.5 million, $15.9 million and $12.5 million in 2014, 2013 and 2012, respectively. | ||||||||||||
Cash Awards | ||||||||||||
Long-Term Incentive Units | ||||||||||||
Long-term incentive units ("LTI Units") are granted under our long-term incentive unit plan to certain eligible employees. LTI Units are service-based awards that generally vest ratably over a four-year period. The settlement value equals the number of vested LTI Units multiplied by the average of the high and low market prices of our common stock on the vesting date. The compensation expense related to these awards is amortized on a straight-line basis and the fair value is remeasured using the estimated percentage of units expected to be earned multiplied by the average of the high and low market prices of our common stock at each quarter-end. | ||||||||||||
We also grant cash-based awards in the form of performance and market-leveraged LTI Units to eligible employees. Performance LTI Units are payable in cash at the end of a three-year cliff vesting period provided that certain performance objectives are achieved at the end of the performance period. Market-leveraged LTI Units are payable in cash and vest ratably over a period of four years. The number of performance and market-leveraged LTI Units earned at vesting is adjusted upward or downward based upon the probability of achieving the performance objectives established for the respective award and the actual number of units issued can range from 0% to 200% of the target units subject to vesting. The performance and market-leveraged LTI Units are remeasured using the estimated percentage of units expected to be earned multiplied by the average of the high and low market prices of our common stock at each quarter-end over their respective performance periods. The compensation expense related to performance LTI Units is amortized on a straight-line basis over their respective performance period. The compensation expense related to market-leveraged LTI Units is amortized on a graded-vesting basis over their respective performance periods. | ||||||||||||
The compensation expense from continuing operations related to LTI Units was $17.8 million in 2014, $10.3 million in 2013, and $1.9 million in 2012. This expense was included in "Marketing, general and administrative expense" in the Consolidated Statements of Income. The total recognized tax benefit related to these units was $5.7 million in 2014, $3.2 million in 2013, and $.5 million in 2012. | ||||||||||||
COST_REDUCTION_ACTIONS
COST REDUCTION ACTIONS | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Cost Reduction Actions | ||||||||||||||||||||
COST REDUCTION ACTIONS | NOTE 13. COST REDUCTION ACTIONS | |||||||||||||||||||
Restructuring Costs | ||||||||||||||||||||
We have compensation plans that provide eligible employees with severance in the event of an involuntary termination due to qualifying cost reduction actions. We calculate severance using the benefit formula under the plans. Accordingly, we record provisions for severance and other exit costs (including asset impairment charges and lease and other contract cancellation costs) when they are probable and estimable. In the absence of a plan or established local practice for overseas jurisdictions, liabilities for restructuring costs are recognized when incurred. | ||||||||||||||||||||
2014 Actions | ||||||||||||||||||||
In 2014, we recorded $66.5 million in restructuring charges, net of reversals, related to restructuring actions we initiated in 2014 ("2014 Actions"), including the consolidation of certain European operations. These charges consisted of severance and related costs for the reduction of approximately 1,420 positions, lease cancellation costs, and asset impairment charges. Approximately 100 employees impacted by our 2014 Actions remained employed with us as of January 3, 2015. We expect payments relating to our 2014 Actions to be completed in 2015. | ||||||||||||||||||||
2012 Program | ||||||||||||||||||||
In 2013, we recorded $40.3 million in restructuring charges, net of reversals, related to the restructuring program we initiated in 2012 ("2012 Program"), which consisted of severance and related costs for the reduction of approximately 1,400 positions, lease and other contract cancellation costs, and asset impairment charges. | ||||||||||||||||||||
In 2012, we recorded $56.4 million in restructuring charges, net of reversals, related to our 2012 Program, which consisted of severance and related costs for the reduction of approximately 1,060 positions, lease cancellation costs, and asset impairment charges. | ||||||||||||||||||||
No employees impacted by the 2012 Program remained employed with us as of December 28, 2013. | ||||||||||||||||||||
2011 Actions | ||||||||||||||||||||
In 2011, we recorded approximately $45 million in restructuring charges, net of reversals, including charges for discontinued operations, consisting of severance and related costs for the reduction of approximately 910 positions, asset impairment charges, and lease cancellation costs. No employees impacted by these actions remained employed with us as of December 29, 2012. | ||||||||||||||||||||
Accruals for severance and related costs and lease and other contract cancellation costs were included in "Other accrued liabilities" in the Consolidated Balance Sheets. For assets that were not disposed, impairments were based on the estimated market value of the assets. | ||||||||||||||||||||
During 2014, restructuring charges and payments were as follows: | ||||||||||||||||||||
(In millions) | Accrual at | Charges | Cash | Non-cash | Foreign | Accrual at | ||||||||||||||
December 28, | (Reversals), | Payments | Impairment | Currency | January 3, | |||||||||||||||
2013 | net | Translation | 2015 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
2014 Actions | ||||||||||||||||||||
Severance and related costs | $ | – | $ | 55.1 | $ | (35.6 | ) | $ | – | $ | (2.7 | ) | $ | 16.8 | ||||||
Asset impairment charges | – | 10.8 | – | (10.8 | ) | – | – | |||||||||||||
Lease cancellation costs | – | 0.6 | (.5 | ) | – | – | 0.1 | |||||||||||||
2012 Program | ||||||||||||||||||||
Severance and related costs | 6.6 | (.4 | ) | (5.2 | ) | – | (.2 | ) | 0.8 | |||||||||||
Lease and other contract cancellation costs | 0.2 | – | (.2 | ) | – | – | – | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 6.8 | $ | 66.1 | $ | (41.5 | ) | $ | (10.8 | ) | $ | (2.9 | ) | $ | 17.7 | |||||
| | | | | | | | | | | | | | | | | | | | |
During 2013, restructuring charges and payments were as follows: | ||||||||||||||||||||
(In millions) | Accrual at | Charges, | Cash | Non-cash | Foreign | Accrual at | ||||||||||||||
December 29, | net | Payments | Impairment | Currency | December 28, | |||||||||||||||
2012 | Translation | 2013 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
2012 Program | ||||||||||||||||||||
Severance and related costs | $ | 20.7 | $ | 27.2 | $ | (41.0 | ) | $ | – | $ | (.3 | ) | $ | 6.6 | ||||||
Lease and other contract cancellation costs | 0.1 | 3.4 | (3.3 | ) | – | – | 0.2 | |||||||||||||
Asset impairment charges | – | 9.7 | – | (9.7 | ) | – | – | |||||||||||||
2011 Actions | ||||||||||||||||||||
Severance and related costs | 0.1 | – | (.1 | ) | – | – | – | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 20.9 | $ | 40.3 | $ | (44.4 | ) | $ | (9.7 | ) | $ | (.3 | ) | $ | 6.8 | |||||
| | | | | | | | | | | | | | | | | | | | |
The table below shows the total amount of restructuring costs incurred by reportable segment and Corporate. Restructuring costs in continuing operations were included in "Other expense, net" in the Consolidated Statements of Income. | ||||||||||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Restructuring costs by reportable segment and Corporate | ||||||||||||||||||||
Pressure-sensitive Materials | $ | 40.2 | $ | 10.8 | $ | 34.1 | ||||||||||||||
Retail Branding and Information Solutions | 21.3 | 28.5 | 17.8 | |||||||||||||||||
Vancive Medical Technologies | 4.2 | 0.1 | 0.9 | |||||||||||||||||
Corporate | 0.4 | 0.9 | 3.0 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Continuing operations | 66.1 | 40.3 | 55.8 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Discontinued operations | – | – | 0.6 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 66.1 | $ | 40.3 | $ | 56.4 | ||||||||||||||
| | | | | | | | | | | ||||||||||
TAXES_BASED_ON_INCOME
TAXES BASED ON INCOME | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Taxes Based on Income | |||||||||||
TAXES BASED ON INCOME | NOTE 14. TAXES BASED ON INCOME | ||||||||||
Taxes based on income (loss) were as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Current: | |||||||||||
U.S. federal tax | $ | 14.5 | $ | 1.9 | $ | (18.7 | ) | ||||
State taxes | (.2 | ) | 0.3 | (2.4 | ) | ||||||
International taxes | 115 | 107.3 | 101.2 | ||||||||
| | | | | | | | | | | |
129.3 | 109.5 | 80.1 | |||||||||
| | | | | | | | | | | |
Deferred: | |||||||||||
U.S. federal tax | (21.4 | ) | (11.2 | ) | 9.5 | ||||||
State taxes | 8 | 1.3 | (9.3 | ) | |||||||
International taxes | (2.6 | ) | 19.2 | (.3 | ) | ||||||
| | | | | | | | | | | |
(16.0 | ) | 9.3 | (.1 | ) | |||||||
| | | | | | | | | | | |
Provision for income taxes | $ | 113.3 | $ | 118.8 | $ | 80 | |||||
| | | | | | | | | | | |
The principal items accounting for the difference between taxes computed at the U.S. statutory rate and taxes recorded were as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Computed tax at 35% of income before taxes | $ | 127.5 | $ | 127.1 | $ | 83.1 | |||||
Increase (decrease) in taxes resulting from: | |||||||||||
State taxes, net of federal tax benefit | 1.4 | 2.4 | 1.1 | ||||||||
Foreign earnings taxed at different rates (1)(2) | (15.9 | ) | (14.7 | ) | 11.8 | ||||||
Valuation allowance | 16 | (4.3 | ) | (23.6 | ) | ||||||
Corporate owned life insurance | (4.2 | ) | (6.9 | ) | (5.5 | ) | |||||
U.S. federal research and development tax credits | (1.6 | ) | (7.0 | ) | – | ||||||
Tax contingencies and audit settlements | (2.7 | ) | 23.1 | 9.4 | |||||||
Expiration of carryforward items | 1.4 | 2.5 | 4.8 | ||||||||
Other items, net | (8.6 | ) | (3.4 | ) | (1.1 | ) | |||||
| | | | | | | | | | | |
Provision for income taxes | $ | 113.3 | $ | 118.8 | $ | 80 | |||||
| | | | | | | | | | | |
-1 | Included foreign earnings taxed in the U.S., net of credits, for all years. | ||||||||||
-2 | Included $12.1 million and $11.2 million of expense related to the accrual of U.S. taxes on certain foreign earnings for 2013 and 2012, respectively. For 2014, there was no such accrual. | ||||||||||
Income (loss) from continuing operations before taxes from our U.S. and international operations was as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
U.S. | $ | 3.5 | $ | (36.2 | ) | $ | (125.7 | ) | |||
International | 360.9 | 399.3 | 363.3 | ||||||||
| | | | | | | | | | | |
Income from continuing operations before taxes | $ | 364.4 | $ | 363.1 | $ | 237.6 | |||||
| | | | | | | | | | | |
The effective tax rate for continuing operations was 31.1%, 32.7%, and 33.7% for fiscal years 2014, 2013, and 2012, respectively. The 2014 effective tax rate for continuing operations included the following: tax benefits for changes in certain tax reserves, including interest and penalties, of $10.2 million resulting from settlements of audits and $18.1 million resulting from lapses and statute expirations; a repatriation tax benefit of $9.8 million related to certain foreign losses; tax expense of $9.1 million from the taxable inclusion of a net foreign currency gain related to the revaluation of certain intercompany loans; tax expense of $10.6 million related to our change in estimate of the potential outcome of uncertain tax issues in China and Germany; and state tax expense of $2.5 million primarily related to gains arising as a result of certain foreign reorganizations. Additionally, the 2014 effective tax rate for continuing operations included a net tax benefit of $.9 million from out-of-period adjustments to properly reflect the valuation allowance related to state deferred tax assets, uncertain tax positions, the cumulative tax effect of currency translation associated with a foreign branch investment, and deferred taxes related to acquisitions completed in 2002 and 2003. The impact of these out-of-period adjustments, individually and in the aggregate, was not material to the periods reported or to any previous financial statements. | |||||||||||
The 2013 effective tax rate for continuing operations reflected $11 million of benefit from adjustments to federal income tax, primarily due to the enactment of the American Taxpayer Relief Act of 2012 ("ATRA"), and $18.8 million of net expense related to changes in certain tax reserves and valuation allowances. Additionally, the effective tax rate for 2013 reflected a benefit of $11.2 million from favorable tax rates on certain earnings from our operations in lower-tax jurisdictions throughout the world, offset by $12.1 million of expense related to the accrual of U.S. taxes on certain foreign earnings. | |||||||||||
The 2012 effective tax rate for continuing operations reflected $6.2 million of benefit from the release of a valuation allowance on certain state tax credits and $11.2 million of expense related to the accrual of U.S. taxes on certain foreign earnings. Additionally, the effective tax rate for 2012 was negatively impacted by approximately $5 million from the statutory expiration of federal research and development tax credits on December 31, 2011. | |||||||||||
On December 19, 2014, the Tax Increase Prevention Act of 2014 was enacted, retroactively extending the controlled foreign corporation ("CFC") look-through rule and the federal research and development credit, which expired on December 31, 2014. The retroactive effects were recognized in the fourth quarter of 2014. The retroactive effects of the extension of the CFC look-through rule did not have a material impact on our effective tax rate or operating results after taking into consideration tax accruals related to our repatriation assertions. | |||||||||||
On January 2, 2013, ATRA was enacted, retrospectively extending the federal research and development credit for amounts paid or incurred after December 31, 2011 and before January 1, 2014. The retroactive effects were recognized in the first quarter of 2013. ATRA also retroactively extended the CFC look-through rule that had expired on December 31, 2011. For periods in which the look-though rule was effective, certain dividends, interest, rents, and royalties received or accrued by a CFC of a U.S. multinational enterprise from a related CFC are excluded from U.S. federal income tax. The retroactive effects of the extension of the CFC look-through rule did not have a material impact on our effective tax rate or operating results after taking into consideration tax accruals related to our repatriation assertions. The extensions of the CFC look-through rule and the research and development credit expired on December 31, 2013. | |||||||||||
Deferred income taxes have not been provided on approximately $2.2 billion of undistributed earnings of foreign subsidiaries as of January 3, 2015 since these amounts are intended to be indefinitely reinvested in foreign operations. It is not practicable to calculate the deferred taxes associated with these earnings because of the variability of multiple factors that would need to be assessed at the time of any assumed repatriation; however, foreign tax credits would likely be available to reduce federal income taxes in the event of distribution. In making this assertion, we evaluate, among other factors, the profitability of our U.S. and foreign operations and the need for cash within and outside the U.S., including cash requirements for capital improvements, acquisitions, market expansion, and stock repurchase programs. | |||||||||||
Deferred income taxes reflect the temporary differences between the amounts at which assets and liabilities are recorded for financial reporting purposes and the amounts utilized for tax purposes. The primary components of the temporary differences that gave rise to our deferred tax assets and liabilities were as follows: | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Accrued expenses not currently deductible | $ | 40.7 | $ | 44.7 | |||||||
Net operating losses | 277.7 | 306.2 | |||||||||
Tax credit carryforwards | 104.2 | 129.2 | |||||||||
Postretirement and postemployment benefits | 97.6 | 100.8 | |||||||||
Pension costs | 154 | 95.7 | |||||||||
Inventory reserves | 9.1 | 8.6 | |||||||||
Other assets | 9.2 | 6.2 | |||||||||
Valuation allowance | (75.0 | ) | (59.0 | ) | |||||||
| | | | | | | | ||||
Total deferred tax assets (2) | 617.5 | 632.4 | |||||||||
| | | | | | | | ||||
Depreciation and amortization | (121.8 | ) | (127.8 | ) | |||||||
Repatriation accrual (1) | 1.9 | (52.9 | ) | ||||||||
Foreign operating loss recapture | (118.0 | ) | (136.5 | ) | |||||||
Other liabilities | (3.0 | ) | (1.8 | ) | |||||||
| | | | | | | | ||||
Total deferred tax liabilities (2) | (240.9 | ) | (319.0 | ) | |||||||
| | | | | | | | ||||
Total net deferred tax assets | $ | 376.6 | $ | 313.4 | |||||||
| | | | | | | | ||||
-1 | Included in the repatriation accrual as of January 3, 2015 was a net deferred tax liability of $4.4 million associated with the future tax cost to repatriate non-permanently reinvested earnings of our foreign subsidiaries which is more than offset by a contra deferred tax liability of $6.3 million related to unrealized foreign exchange losses associated with earnings of our foreign subsidiaries that can be repatriated to the U.S. in future periods without incurring any additional U.S. federal income taxes. | ||||||||||
-2 | Reflect gross amounts before jurisdictional netting of deferred tax assets and liabilities. | ||||||||||
A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. The valuation allowance at January 3, 2015 and December 28, 2013 was $75 million and $59 million, respectively. | |||||||||||
Net operating loss carryforwards of foreign subsidiaries at January 3, 2015 and December 28, 2013 were $928.7 million and $1.06 billion, respectively. Tax credit carryforwards of both domestic and foreign subsidiaries at January 3, 2015 and December 28, 2013 totaled $104.2 million and $129.2 million, respectively. If unused, foreign net operating losses and tax credit carryforwards will expire as follows: | |||||||||||
(In millions) | Net Operating | Tax Credits | |||||||||
Losses (1) | |||||||||||
| | | | | | | | ||||
Expires in 2015 | $ | 15.3 | $ | 0.6 | |||||||
Expires in 2016 | 8.1 | 0.7 | |||||||||
Expires in 2017 | 15.5 | 0.4 | |||||||||
Expires in 2018 | 16.5 | 23.9 | |||||||||
Expires in 2019 | 4.6 | 33.2 | |||||||||
Expires in 2020 | 17.7 | 15.9 | |||||||||
Expires in 2021 | 8.2 | 0.3 | |||||||||
Expires in 2022 | 2.8 | 9.6 | |||||||||
Expires in 2023 | 13.7 | 5.2 | |||||||||
Expires in 2024 | 3.3 | 0.3 | |||||||||
Expires in 2025 | – | 0.1 | |||||||||
Expires in 2026 | – | 1.2 | |||||||||
Expires in 2027 | – | 0.1 | |||||||||
Expires in 2028 | – | 0.1 | |||||||||
Expires in 2029 | 1.8 | 0.1 | |||||||||
Expires in 2030 | 0.4 | – | |||||||||
Expires in 2031 | 0.6 | – | |||||||||
Expires in 2032 | 1.1 | – | |||||||||
Expires in 2033 | – | 1.8 | |||||||||
Expires in 2034 | – | 1.6 | |||||||||
Indefinite life/no expiration | 819.1 | 9.1 | |||||||||
| | | | | | | | ||||
Total | $ | 928.7 | $ | 104.2 | |||||||
| | | | | | | | ||||
-1 | Net operating losses are presented before tax effect | ||||||||||
Based on current projections, certain indefinite-lived foreign net operating losses may take up to 50 years to be fully utilized. | |||||||||||
We do not anticipate the expected expiration of our remaining tax holidays in Thailand and Vietnam between 2015 and 2016 to have a material effect on our effective tax rate, operating results, or financial condition. | |||||||||||
Unrecognized Tax Benefits | |||||||||||
As of January 3, 2015, our unrecognized tax benefits totaled $122.6 million, $98.7 million of which, if recognized, would reduce our annual effective income tax rate. As of December 28, 2013, our unrecognized tax benefits totaled $137.2 million, $96.7 million of which, if recognized, would reduce our annual effective income tax rate. | |||||||||||
Where applicable, we recognize potential accrued interest and penalties related to unrecognized tax benefits from our global operations in income tax expense. We recognized a tax benefit of $1.3 million, and tax expense of $2.7 million and $5.5 million in the Consolidated Statements of Income in 2014, 2013, and 2012, respectively. We have accrued $26.7 million and $29.2 million for interest and penalties, net of tax benefit, in the Consolidated Balance Sheets at January 3, 2015 and December 28, 2013, respectively. | |||||||||||
A reconciliation of the beginning and ending amounts of unrecognized tax benefits is set forth below: | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Balance at beginning of year | $ | 137.2 | $ | 121.6 | |||||||
Additions based on tax positions related to the current year | 18.2 | 20.1 | |||||||||
Additions for tax positions of prior years | 7.8 | 8.3 | |||||||||
Reductions for tax positions of prior years: | |||||||||||
Changes in judgment | (1.8 | ) | (4.0 | ) | |||||||
Settlements | (15.8 | ) | (2.6 | ) | |||||||
Lapses and statute expirations | (13.8 | ) | (6.2 | ) | |||||||
Changes due to translation of foreign currencies | (9.2 | ) | – | ||||||||
| | | | | | | | ||||
Balance at end of year | $ | 122.6 | $ | 137.2 | |||||||
| | | | | | | | ||||
The amount of income taxes we pay is subject to ongoing audits by taxing jurisdictions around the world. Our estimate of the potential outcome of any uncertain tax issue is subject to our assessment of relevant risks, facts, and circumstances existing at that time. We believe that we have adequately provided for reasonably foreseeable outcomes related to these matters. However, our future results may include favorable or unfavorable adjustments to our estimated tax liabilities in the period the assessments are made or resolved, which may impact our effective tax rate. As of the date the 2014 financial statements are being issued, we and our U.S. subsidiaries have completed the Internal Revenue Service's Compliance Assurance Process Program through 2013. We are subject to routine tax examinations in other jurisdictions. With a few exceptions, we are no longer subject to examinations by tax authorities for years prior to 2006. | |||||||||||
It is reasonably possible that, during the next 12 months, we may realize a decrease in our uncertain tax positions, including interest and penalties, of approximately $12 million, as a result of settlements and closing tax years. | |||||||||||
SEGMENT_INFORMATION
SEGMENT INFORMATION | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Segment Information | |||||||||||
SEGMENT INFORMATION | NOTE 15. SEGMENT INFORMATION | ||||||||||
Segment Reporting | |||||||||||
We have the following operating and reportable segments: | |||||||||||
• | Pressure-sensitive Materials – manufactures and sells pressure-sensitive labeling technology and materials, films for graphic and reflective applications, performance polymers (largely adhesives used to manufacture pressure-sensitive materials), and performance tapes; | ||||||||||
• | Retail Branding and Information Solutions – designs, manufactures and sells a wide variety of branding and information products and services, including brand and price tickets, tags and labels (including RFID inlays), and related services, supplies and equipment; and | ||||||||||
• | Vancive Medical Technologies – manufactures an array of pressure-sensitive adhesive products for surgical, wound care, ostomy, and electromedical applications. | ||||||||||
Intersegment sales are recorded at or near market prices and are eliminated in determining consolidated sales. We evaluate performance based on income from operations before interest expense and taxes. General corporate expenses are also excluded from the computation of income from operations for the segments. | |||||||||||
We do not disclose total assets by reportable segment since we do not produce and review such information internally. As our reporting structure is not organized or reviewed internally by country, results by individual country are not provided. | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | |||||||||||
Pressure-sensitive Materials | $ | 4,658.10 | $ | 4,455.00 | $ | 4,257.60 | |||||
Retail Branding and Information Solutions | 1,591.60 | 1,611.10 | 1,535.00 | ||||||||
Vancive Medical Technologies | 80.6 | 73.9 | 70.9 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | $ | 6,330.30 | $ | 6,140.00 | $ | 5,863.50 | |||||
| | | | | | | | | | | |
Intersegment sales | |||||||||||
Pressure-sensitive Materials | $ | 63.2 | $ | 64.6 | $ | 60.9 | |||||
Retail Branding and Information Solutions | 2.4 | 2.4 | 3.8 | ||||||||
Vancive Medical Technologies | 9.6 | 3.6 | 0.8 | ||||||||
| | | | | | | | | | | |
Intersegment sales | $ | 75.2 | $ | 70.6 | $ | 65.5 | |||||
| | | | | | | | | | | |
Income from continuing operations before taxes | |||||||||||
Pressure-sensitive Materials | $ | 434.4 | $ | 442.8 | $ | 359.7 | |||||
Retail Branding and Information Solutions | 87.9 | 81.7 | 53.3 | ||||||||
Vancive Medical Technologies | (11.7 | ) | (8.3 | ) | (16.2 | ) | |||||
Corporate expense | (82.9 | ) | (94.1 | ) | (86.3 | ) | |||||
Interest expense | (63.3 | ) | (59.0 | ) | (72.9 | ) | |||||
| | | | | | | | | | | |
Income from continuing operations before taxes | $ | 364.4 | $ | 363.1 | $ | 237.6 | |||||
| | | | | | | | | | | |
Capital expenditures | |||||||||||
Pressure-sensitive Materials | $ | 110.5 | $ | 81.1 | $ | 64.8 | |||||
Retail Branding and Information Solutions | 39.6 | 42.4 | 24.7 | ||||||||
Vancive Medical Technologies | 2.1 | 1.2 | 3.4 | ||||||||
| | | | | | | | | | | |
Capital expenditures | $ | 152.2 | $ | 124.7 | $ | 92.9 | |||||
| | | | | | | | | | | |
Depreciation and amortization expense | |||||||||||
Pressure-sensitive Materials | $ | 116 | $ | 113.5 | $ | 112.8 | |||||
Retail Branding and Information Solutions | 81.4 | 86.7 | 93.9 | ||||||||
Vancive Medical Technologies | 4.2 | 4.1 | 4.3 | ||||||||
| | | | | | | | | | | |
Depreciation and amortization expense | $ | 201.6 | $ | 204.3 | $ | 211 | |||||
| | | | | | | | | | | |
Other expense, net by reportable segment | |||||||||||
Pressure-sensitive Materials | $ | 41.6 | $ | 10.8 | $ | 33.5 | |||||
Retail Branding and Information Solutions | 22 | 20 | 24.8 | ||||||||
Vancive Medical Technologies | 4.2 | 0.1 | 4.8 | ||||||||
Corporate | 0.4 | 5.7 | 5.7 | ||||||||
| | | | | | | | | | | |
Other expense, net | $ | 68.2 | $ | 36.6 | $ | 68.8 | |||||
| | | | | | | | | | | |
Other expense, net by type | |||||||||||
Restructuring costs: | |||||||||||
Severance and related costs | $ | 54.7 | $ | 27.2 | $ | 49.3 | |||||
Asset impairment charges and lease and other contract cancellation costs | 11.4 | 13.1 | 6.5 | ||||||||
Other items: | |||||||||||
Charitable contribution to Avery Dennison Foundation | – | 10 | – | ||||||||
Indefinite-lived intangible asset impairment charge | 3 | – | 7 | ||||||||
Gain on sale of product line | – | – | (.6 | ) | |||||||
Gains on sales of assets | (2.5 | ) | (17.8 | ) | – | ||||||
Loss (gain) from curtailment and settlement of pension obligation | 1.6 | (1.6 | ) | – | |||||||
Legal settlements | – | 2.5 | – | ||||||||
Product line exits | – | – | 3.9 | ||||||||
Divestiture-related costs (1) | – | 3.2 | 2.7 | ||||||||
| | | | | | | | | | | |
Other expense, net | $ | 68.2 | $ | 36.6 | $ | 68.8 | |||||
| | | | | | | | | | | |
-1 | Represents only the portion allocated to continuing operations. | ||||||||||
Within Pressure-sensitive Materials, net sales to unaffiliated customers of the Materials product group were $4.33 billion, $4.16 billion, and $3.98 billion in 2014, 2013, and 2012, respectively, and net sales to unaffiliated customers of the Performance Tapes product group were $332.5 million, $293 million, and $274.2 million in 2014, 2013, and 2012, respectively. | |||||||||||
Revenues in our continuing operations by geographic area are set forth below. Revenues are attributed to geographic areas based on the location to which the product is shipped. Export sales from the United States to unaffiliated customers are not a material factor in our business. | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | |||||||||||
U.S. | $ | 1,529.4 | $ | 1,537.6 | $ | 1,528.3 | |||||
Europe | 2,074.4 | 1,958.4 | 1,851.1 | ||||||||
Asia | 1,914.2 | 1,823.5 | 1,627.6 | ||||||||
Latin America | 522.9 | 515.6 | 501.2 | ||||||||
Other international | 289.4 | 304.9 | 355.3 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | $ | 6,330.3 | $ | 6,140.0 | $ | 5,863.5 | |||||
| | | | | | | | | | | |
Property, plant and equipment, net, in our U.S. and international operations are set forth below. | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Property, plant and equipment, net | |||||||||||
U.S. | $ | 261.5 | $ | 279.6 | $ | 340.2 | |||||
International | 613.8 | 642.9 | 675.3 | ||||||||
| | | | | | | | | | | |
Property, plant and equipment, net | $ | 875.3 | $ | 922.5 | $ | 1,015.5 | |||||
| | | | | | | | | | | |
SUPPLEMENTAL_FINANCIAL_INFORMA
SUPPLEMENTAL FINANCIAL INFORMATION | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Supplemental Financial Information [Abstract] | |||||||||||
SUPPLEMENTAL FINANCIAL INFORMATION | NOTE 16. SUPPLEMENTAL FINANCIAL INFORMATION | ||||||||||
Inventories | |||||||||||
Net inventories at year-end were as follows: | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Raw materials | $ | 183.6 | $ | 196.3 | |||||||
Work-in-progress | 150.4 | 149.0 | |||||||||
Finished goods | 157.8 | 148.8 | |||||||||
| | | | | | | | ||||
Inventories, net | $ | 491.8 | $ | 494.1 | |||||||
| | | | | | | | ||||
Property, Plant and Equipment | |||||||||||
Major classes of property, plant and equipment, stated at cost, at year-end were as follows: | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Land | $ | 32.1 | $ | 47 | |||||||
Buildings and improvements | 578.2 | 580.2 | |||||||||
Machinery and equipment | 1,958.20 | 2,001.30 | |||||||||
Construction-in-progress | 86 | 74.3 | |||||||||
| | | | | | | | ||||
Property, plant and equipment | 2,654.50 | 2,702.80 | |||||||||
Accumulated depreciation | (1,779.2 | ) | (1,780.3 | ) | |||||||
| | | | | | | | ||||
Property, plant and equipment, net | $ | 875.3 | $ | 922.5 | |||||||
| | | | | | | | ||||
Software | |||||||||||
Capitalized software costs at year-end were as follows: | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Cost | $ | 445.7 | $ | 427.9 | |||||||
Accumulated amortization | (293.1 | ) | (264.6 | ) | |||||||
| | | | | | | | ||||
Software, net | $ | 152.6 | $ | 163.3 | |||||||
| | | | | | | | ||||
Software amortization expense from continuing operations was $36.4 million in 2014, $35.3 million in 2013, and $30.7 million in 2012. | |||||||||||
Research and Development | |||||||||||
Research and development expense from continuing operations, which is included in "Marketing, general and administrative expense" in the Consolidated Statements of Income, was as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Research and development expense | $ | 102.5 | $ | 96.0 | $ | 98.6 | |||||
| | | | | | | | | | | |
Supplemental Cash Flow Information | |||||||||||
Cash paid for interest and income taxes, including amounts paid for discontinued operations, was as follows: | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Interest, net of capitalized amounts | $ | 61.6 | $ | 64.1 | $ | 68.0 | |||||
Income taxes, net of refunds | 108.8 | 129.4 | 97.7 | ||||||||
| | | | | | | | | | | |
Capital expenditures accrued but not paid, including amounts for discontinued operations, were $3.8 million in 2014, $11.5 million in 2013, and $12 million in 2012. | |||||||||||
Currency Effects | |||||||||||
Gains and losses resulting from foreign currency transactions are included in income in the period incurred. Transactions in foreign currencies (including receivables, payables and loans denominated in currencies other than the functional currency), including hedging impacts, decreased net income by $8.7 million, $7.9 million, and $8.8 million in 2014, 2013, and 2012, respectively. | |||||||||||
We had no operations in hyperinflationary economies in fiscal years 2014, 2013, or 2012. | |||||||||||
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION (Unaudited) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
QUARTERLY FINANCIAL INFORMATION (Unaudited) | ||||||||||||||
QUARTERLY FINANCIAL INFORMATION (Unaudited) | NOTE 17. QUARTERLY FINANCIAL INFORMATION (Unaudited) | |||||||||||||
(In millions, except per share data) | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter (1) | |||||||||||
| | | | | | | | | | | | | | |
2014 | ||||||||||||||
Net sales | $ | 1,550.10 | $ | 1,615.80 | $ | 1,559.60 | $ | 1,604.80 | ||||||
Gross profit | 407.2 | 428.2 | 400.7 | 415.1 | ||||||||||
Income from continuing operations | 71.6 | 44.4 | 65 | 70.1 | ||||||||||
(Loss) income from discontinued operations, net of tax | (.4 | ) | (1.9 | ) | (.7 | ) | 0.8 | |||||||
Net income | 71.2 | 42.5 | 64.3 | 70.9 | ||||||||||
Net income (loss) per common share: | ||||||||||||||
Continuing operations | 0.74 | 0.47 | 0.7 | 0.77 | ||||||||||
Discontinued operations | – | (.02 | ) | (.01 | ) | 0.01 | ||||||||
Net income per common share | 0.74 | 0.45 | 0.69 | 0.78 | ||||||||||
Net income (loss) per common share, assuming dilution: | ||||||||||||||
Continuing operations | 0.73 | 0.46 | 0.68 | 0.75 | ||||||||||
Discontinued operations | – | (.02 | ) | – | 0.01 | |||||||||
Net income per common share, assuming dilution | 0.73 | 0.44 | 0.68 | 0.76 | ||||||||||
| | | | | | | | | | | | | | |
2013 | ||||||||||||||
Net sales | $ | 1,498.90 | $ | 1,552.30 | $ | 1,504.90 | $ | 1,583.90 | ||||||
Gross profit | 401.7 | 417.5 | 402.2 | 416.3 | ||||||||||
Income from continuing operations | 66.8 | 70.8 | 62 | 44.7 | ||||||||||
Loss from discontinued operations, net of tax | (9.0 | ) | (2.0 | ) | (15.5 | ) | (2.0 | ) | ||||||
Net income | 57.8 | 68.8 | 46.5 | 42.7 | ||||||||||
Net income (loss) per common share: | ||||||||||||||
Continuing operations | 0.67 | 0.71 | 0.63 | 0.46 | ||||||||||
Discontinued operations | (.09 | ) | (.02 | ) | (.16 | ) | (.02 | ) | ||||||
Net income per common share | 0.58 | 0.69 | 0.47 | 0.44 | ||||||||||
Net income (loss) per common share, assuming dilution: | ||||||||||||||
Continuing operations | 0.66 | 0.7 | 0.62 | 0.45 | ||||||||||
Discontinued operations | (.09 | ) | (.02 | ) | (.15 | ) | (.02 | ) | ||||||
Net income per common share, assuming dilution | 0.57 | 0.68 | 0.47 | 0.43 | ||||||||||
| | | | | | | | | | | | | | |
-1 | Results for the fourth quarter of 2014 reflected the extra week in our 2014 fiscal year. | |||||||||||||
"Other expense, net" is presented by type for each quarter below: | ||||||||||||||
(In millions) | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
| | | | | | | | | | | | | | |
2014 | ||||||||||||||
Restructuring costs: | ||||||||||||||
Severance and related costs | $ | 7 | $ | 35.9 | $ | 5.1 | $ | 6.7 | ||||||
Asset impairment charges and lease cancellation costs | 0.3 | 2.6 | 1.6 | 6.9 | ||||||||||
Other items: | ||||||||||||||
Indefinite-lived intangible asset impairment charge | – | – | 3 | – | ||||||||||
Gains on sales of assets | – | (.6 | ) | (1.9 | ) | – | ||||||||
Losses from curtailment and settlement of pension obligations | – | 0.6 | – | 1 | ||||||||||
| | | | | | | | | | | | | | |
Other expense, net | $ | 7.3 | $ | 38.5 | $ | 7.8 | $ | 14.6 | ||||||
| | | | | | | | | | | | | | |
2013 | ||||||||||||||
Restructuring costs: | ||||||||||||||
Severance and related costs | $ | 6.8 | $ | 5.4 | $ | 8.7 | $ | 6.3 | ||||||
Asset impairment charges and lease and other contract cancellation costs | 1.3 | 2.4 | 8 | 1.4 | ||||||||||
Other items: | ||||||||||||||
Charitable contribution to Avery Dennison Foundation | – | – | 10 | – | ||||||||||
Gains on sale of assets | (1.3 | ) | (10.9 | ) | (.5 | ) | (5.1 | ) | ||||||
Gain from curtailment of pension obligation | – | – | (1.6 | ) | – | |||||||||
Legal settlement | – | 2.5 | – | – | ||||||||||
Divestiture-related costs (1) | 0.7 | 0.3 | 1.1 | 1.1 | ||||||||||
| | | | | | | | | | | | | | |
Other expense, net | $ | 7.5 | $ | (.3 | ) | $ | 25.7 | $ | 3.7 | |||||
| | | | | | | | | | | | | | |
-1 | Represents only the portion allocated to continuing operations. | |||||||||||||
SCHEDULE_IIVALUATION_AND_QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | ||||||||||||||
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS AND RESERVES | |||||||||||||
(In millions) | ||||||||||||||
Balance at | Net Additions | Deductions | Balance | |||||||||||
Beginning | Charged to Costs | From | at End | |||||||||||
of Year | and Expenses | Reserves(a) | of Year | |||||||||||
2014 | ||||||||||||||
Allowance for doubtful accounts | $ | 21.4 | $ | 6.3 | $ | (6.9 | ) | $ | 20.8 | |||||
Allowance for sales returns | 10.2 | 14.4 | (14.9 | ) | 9.7 | |||||||||
2013 | ||||||||||||||
Allowance for doubtful accounts | 31.1 | 5.1 | (14.8 | ) | 21.4 | |||||||||
Allowance for sales returns | 13.7 | 11.2 | (14.7 | ) | 10.2 | |||||||||
2012 | ||||||||||||||
Allowance for doubtful accounts | 34 | 3.4 | (6.3 | ) | 31.1 | |||||||||
Allowance for sales returns | 9.3 | 14.5 | (10.1 | ) | 13.7 | |||||||||
(a) | Deductions from reserves include currency translation adjustments for all periods and the sale of the DES business in 2013. | |||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |
Jan. 03, 2015 | ||
General | ||
Nature of Operations | Nature of Operations | |
We develop identification and decorative solutions primarily for businesses worldwide. Our products include pressure-sensitive labeling technology and materials; graphics imaging media; retail branding and information solutions; radio-frequency identification ("RFID") inlays and tags; performance tapes; and medical solutions. | ||
Principles of Consolidation | Principles of Consolidation | |
The consolidated financial statements include the accounts of majority-owned subsidiaries. Intercompany accounts, transactions and profits are eliminated in consolidation. | ||
Financial Presentation | Financial Presentation | |
In the first quarter of 2014, we began reporting Vancive Medical Technologies as a reportable segment. This business was previously reported within a category entitled "other specialty converting businesses" and was the only business that comprised that category in the prior periods presented. | ||
As further discussed in Note 2, "Discontinued Operations and Sale of Assets," we have classified the operating results of our Office and Consumer Products ("OCP") and Designed and Engineered Solutions ("DES") businesses, together with certain costs associated with their divestiture, as discontinued operations in the Consolidated Statements of Income for all periods presented. Unless otherwise noted, the results and financial condition of discontinued operations have been excluded from the notes to our Consolidated Financial Statements. | ||
Fiscal Year | Fiscal Year | |
Normally, our fiscal years consist of 52 weeks, but every fifth or sixth fiscal year consists of 53 weeks. Our 2014 fiscal year consisted of a 53-week period ending January 3, 2015 and our 2013 and 2012 fiscal years consisted of 52-week periods ending December 28, 2013 and December 29, 2012, respectively. | ||
Use of Estimates | Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions for the reporting period and as of the date of the financial statements. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenue and expense. Actual results could differ from these estimates. | ||
Cash and Cash Equivalents | Cash and Cash Equivalents | |
Cash and cash equivalents consist of cash on hand, deposits in banks, and short-term investments with maturities of three months or less when purchased. The carrying value of these assets approximates fair value due to the short maturity of the instruments. | ||
Accounts Receivable | Accounts Receivable | |
We record trade accounts receivable at the invoiced amount. The allowance for doubtful account reserve represents allowances for customer trade accounts receivable that are estimated to be partially or entirely uncollectible. The customer complaint reserve represents estimated sales returns and allowances. These allowances are used to reduce gross trade receivables to their net realizable values. We record these allowances based on estimates related to: | ||
• | Customer-specific allowances; | |
• | Amounts based upon an aging schedule; and | |
• | An amount, based on our historical experience, for allowances not yet identified. | |
No single customer represented 10% or more of our net sales in, or trade accounts receivable at, year-end 2014 or 2013. However, during 2014, our ten largest customers by net sales represented 13% of our net sales. As of January 3, 2015, our ten largest customers by trade accounts receivable represented 15% of our trade accounts receivable. These customers were concentrated in the Pressure-sensitive Materials segment. We do not generally require our customers to provide collateral. | ||
Inventories | Inventories | |
Inventories are stated at the lower-of-cost-or-market value and are categorized as raw materials, work-in-progress or finished goods. Cost is determined using the first-in, first-out ("FIFO") method. Inventory reserves are recorded to cost of products sold for damaged, obsolete, excess and slow-moving inventory and we establish a lower cost basis for the inventory. We use estimates to record these reserves. Slow-moving inventory is reviewed by category and may be partially or fully reserved for depending on the type of product, level of usage, and the length of time the product has been included in inventory. | ||
Property, Plant and Equipment | Property, Plant and Equipment | |
Depreciation is generally computed using the straight-line method over the estimated useful lives of the assets, ranging from ten to forty-five years for buildings and improvements and three to fifteen years for machinery and equipment. Leasehold improvements are depreciated over the shorter of the useful life of the asset or the term of the associated leases. Maintenance and repair costs are expensed as incurred; renewals and betterments are capitalized. Upon the sale or retirement of assets, the accounts are relieved of the cost and the related accumulated depreciation, with any resulting gain or loss included in net income. | ||
Software | Software | |
We capitalize internal and external software costs that are incurred during the application development stage of software development, including costs incurred for the design, coding, installation to hardware, testing, and upgrades and enhancements that provide the software or hardware with additional functionalities and capabilities. Internal and external software costs during the preliminary project stage are expensed, as are those costs during the post-implementation and/or operation stage, including internal and external training costs and maintenance costs. Capitalized software, which is included in "Other assets" in the Consolidated Balance Sheets, is amortized on a straight-line basis over the estimated useful life of the software, generally between five and ten years. | ||
Impairment of Long-lived Assets | Impairment of Long-lived Assets | |
Impairment charges are recorded when the carrying amounts of long-lived assets are determined not to be recoverable. Recoverability is measured by comparing the undiscounted cash flows expected from their use and eventual disposition to the carrying value of the related asset or asset group. The amount of impairment loss is calculated as the excess of the carrying value over the fair value. Historically, changes in market conditions and management strategy have caused us to reassess the carrying amount of our long-lived assets. | ||
Goodwill and Other Intangibles Resulting from Business Acquisitions | Goodwill and Other Intangibles Resulting from Business Acquisitions | |
Business combinations are accounted for by the acquisition method, with the excess of the acquisition cost over the fair value of net tangible assets and identified intangible assets acquired considered goodwill. As a result, we disclose goodwill separately from other intangible assets. Other identifiable intangibles include customer relationships, patents and other acquired technology, trade names and trademarks, and other intangibles. | ||
We have the following reporting units: materials; retail branding and information solutions; reflective solutions; performance tapes; and medical solutions. In performing the required impairment tests, we primarily apply a present value (discounted cash flow) method to determine the fair value of the reporting units with goodwill. We perform our annual impairment test of goodwill during the fourth quarter. | ||
Certain factors may result in the need to perform an impairment test prior to the fourth quarter, including significant underperformance of a business relative to expected operating results, significant adverse economic and industry trends, significant decline in our market capitalization for an extended period of time relative to net book value, or a decision to divest a portion of a reporting unit. | ||
We determine goodwill impairment using a two-step process. The first step is to identify if a potential impairment exists by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered to have a potential impairment and the second step of the impairment test is not necessary. However, if the carrying amount of a reporting unit exceeds its fair value, the second step is performed to determine if goodwill is impaired and to measure the amount of impairment loss to recognize, if any. | ||
The second step, if necessary, compares the implied fair value of goodwill with the carrying amount of goodwill. If the implied fair value of goodwill exceeds the carrying amount, then goodwill is not considered impaired. However, if the carrying amount of goodwill exceeds the implied fair value, an impairment loss is recognized in an amount equal to that excess. | ||
In consultation with outside specialists, we estimate the fair value of our reporting units using various valuation techniques, with the primary technique being a discounted cash flow analysis. A discounted cash flow analysis requires us to make various assumptions about the reporting units, including sales, operating margins, growth rates, and discount rates. Assumptions about discount rates are based on a weighted-average cost of capital for comparable companies. Assumptions about sales, operating margins, and growth rates are based on our forecasts, business plans, economic projections, anticipated future cash flows and marketplace data. Assumptions are also made for varying perpetual growth rates for periods beyond the long-term business plan period. We base our fair value estimates on projected financial information and assumptions that we believe are reasonable. However, actual future results may differ from those estimates and projections, and those differences may be material. The valuation methodology used to estimate the fair value of reporting units requires inputs and assumptions that reflect current market conditions, as well as the impact of planned business and operational strategies that require management judgment. The estimated fair value could increase or decrease depending on changes in the inputs and assumptions. | ||
We test indefinite-lived intangible assets, consisting of trademarks, for impairment in the fourth quarter or whenever events or circumstances indicate that it is more likely than not that their carrying values exceed their fair values. Fair value is estimated as the discounted value of future revenues using a royalty rate that a third party would pay for use of the asset. Variation in the royalty rates could impact the estimate of fair value. If the carrying amount of an asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. | ||
See also Note 3, "Goodwill and Other Intangibles Resulting from Business Acquisitions." | ||
Foreign Currency | Foreign Currency | |
Asset and liability accounts of international operations are translated into U.S. dollars at current rates. Revenues and expenses are translated at the weighted-average currency rate for the fiscal year. Translation gains and losses of subsidiaries operating in hyperinflationary economies, if any, are included in net income in the period incurred. Gains and losses resulting from hedging the value of investments in certain international operations and from translation of balance sheet accounts are recorded directly as a component of other comprehensive income. | ||
Financial Instruments | Financial Instruments | |
We enter into foreign exchange hedge contracts to reduce our risk from exchange rate fluctuations associated with receivables, payables, loans and firm commitments denominated in certain foreign currencies that arise primarily as a result of our operations outside the U.S. We enter into interest rate contracts to help manage our exposure to certain interest rate fluctuations. We also enter into futures contracts to hedge certain price fluctuations for a portion of our anticipated domestic purchases of natural gas. The maximum length of time for which we hedge our exposure to the variability in future cash flows for forecasted transactions is 36 months. | ||
On the date we enter into a derivative contract, we determine whether the derivative will be designated as a hedge. Those derivatives not designated as hedges are recorded on the balance sheets at fair value, with changes in the fair value recognized in earnings. Those derivatives designated as hedges are classified as either (1) hedges of the fair value of a recognized asset or liability or an unrecognized firm commitment ("fair value" hedges); or (2) hedges of a forecasted transaction or the variability of cash flows that are to be received or paid in connection with a recognized asset or liability ("cash flow" hedges). Our policy is not to purchase or hold any foreign currency, interest rate or commodity contracts for trading purposes. | ||
We assess, both at the inception of the hedge and on an ongoing basis, whether hedges are highly effective. If it is determined that a hedge is not highly effective, we prospectively discontinue hedge accounting. For cash flow hedges, the effective portion of the related gains and losses is recorded as a component of other comprehensive income, and the ineffective portion is reported in earnings. Amounts in accumulated other comprehensive income (loss) are reclassified into earnings in the same period during which the hedged transaction affects earnings. In the event the anticipated transaction is no longer likely to occur, we recognize the change in fair value of the instrument in current period earnings. Changes in fair value hedges are recognized in current period earnings. Changes in the fair value of underlying hedged items (such as recognized assets or liabilities) are also recognized in current period earnings and offset the changes in the fair value of the derivative. | ||
In the Consolidated Statements of Cash Flows, hedge transactions are classified in the same category as the item hedged, primarily in operating activities. | ||
See also Note 5, "Financial Instruments." | ||
Fair Value Measurements | Fair Value Measurements | |
We define fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability. | ||
We determine fair value based on a three-tier fair value hierarchy, which we use to prioritize the inputs used in measuring fair value. These tiers consist of Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring us to develop our own assumptions to determine the best estimate of fair value. | ||
Revenue Recognition | Revenue Recognition | |
Sales are recognized when persuasive evidence of an arrangement exists, pricing is determinable, delivery has occurred based on applicable sales terms, and collection is reasonably assured. Sale terms are generally free on board (f.o.b.) shipping point or f.o.b. destination, depending upon local business customs. For most regions in which we operate, f.o.b. shipping point terms are utilized and sales are recorded at the time of shipment, because this is when title and risk of loss are transferred. In certain regions, notably in Europe, f.o.b. destination terms are generally utilized and sales are recorded when the products are delivered to the customer's delivery site, because this is when title and risk of loss are transferred. Furthermore, sales, provisions for estimated returns, and the cost of products sold are recorded at the time title transfers to customers and when the customers assume the risks and rewards of ownership. Actual product returns are charged against estimated sales return allowances. | ||
Sales rebates and discounts are common practice in the industries in which we operate. Volume, promotional, price, cash and other discounts and customer incentives are accounted for as a reduction to gross sales. Rebates and discounts are recorded based upon estimates at the time products are sold. These estimates are based on our historical experience for similar programs and products. We review these rebates and discounts on an ongoing basis and accruals for rebates and discounts are adjusted, if necessary, as additional information becomes available. | ||
Research and Development | Research and Development | |
Research and development costs are related to research, design and testing of new products and applications and are expensed as incurred. | ||
Long-Term Incentive Compensation | Long-Term Incentive Compensation | |
No long-term incentive compensation expense was capitalized for the years ended 2014, 2013, or 2012. | ||
Changes in estimated forfeiture rates are recorded as cumulative adjustments in the period estimates are revised. | ||
Valuation of Stock-Based Awards | ||
Our stock-based compensation expense is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a straight-line basis over the requisite service period for stock options and restricted stock units ("RSUs"). Compensation expense for performance units ("PUs") is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a straight-line basis as these awards cliff-vest at the end of the requisite service period. The compensation expense related to market-leveraged stock units ("MSUs") is based on the fair value of awards, adjusted for estimated forfeitures, and amortized on a graded-vesting basis over their respective performance periods. | ||
Compensation expense for awards with a market condition as a performance objective, which includes PUs and MSUs, is not adjusted if the condition is not met, as long as the requisite service period is met. | ||
The fair value of stock options is estimated as of the date of grant using the Black-Scholes option-pricing model. This model requires input assumptions for our expected dividend yield, expected stock price volatility, risk-free interest rate and the expected option term. | ||
The fair value of RSUs and certain PUs that are subject to achievement of performance objectives based on a performance condition is determined based on the fair market value of our common stock as of the date of grant, adjusted for foregone dividends. | ||
The fair value of stock-based awards that are subject to achievement of performance objectives based on a market condition, which includes MSUs and certain PUs, is determined using the Monte-Carlo simulation model, which utilizes multiple input variables, including expected volatility and other assumptions appropriate for determining fair value, to estimate the probability of satisfying the target performance objectives established for the award. | ||
Certain of these assumptions are based on management's estimates, in consultation with outside specialists. Significant changes in assumptions for future awards and actual forfeiture rates could materially impact stock-based compensation expense and our results of operations. | ||
Valuation of Cash-Based Awards | ||
Cash-based awards consist of long-term incentive units ("LTI Units") granted to eligible employees. Cash-based awards are classified as liability awards and remeasured at each quarter-end over the applicable vesting or performance period. In addition to LTI Units with terms and conditions that mirror those of RSUs, we also grant certain employees LTI Units with terms and conditions that mirror those of PUs and MSUs. | ||
Accounting for Income Taxes for Stock-Based Compensation | ||
We elected to use the short-cut method to calculate the historical pool of windfall tax benefits related to employee and non-employee director stock-based compensation awards. In addition, we elected to follow the tax law ordering approach to determine the sequence in which deductions and net operating loss carryforwards are utilized, as well as the direct-only approach to calculate the amount of windfall or shortfall tax benefits. | ||
See also Note 12, "Long-term Incentive Compensation." | ||
Taxes Based on Income | Taxes Based on Income | |
Our provision for income taxes is determined using the asset and liability approach following the provisions of ASC 740, Accounting for Income Taxes. Under this approach, deferred income taxes represent the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities. We record a valuation allowance to reduce our deferred tax assets when uncertainty regarding their realizability exists. We recognize and measure our uncertain tax positions following the more-likely-than-not threshold for financial statement recognition and measurement for tax positions taken or expected to be taken in a tax return. | ||
See also Note 14, "Taxes Based on Income." | ||
Recent Accounting Requirements | Recent Accounting Requirements | |
In January 2015, the Financial Accounting Standards Board ("FASB") issued guidance on simplification of income statement classification by removing the concept of extraordinary items from GAAP. Items that are both unusual and infrequent will no longer be separately reported net of tax after continuing operations. The existing requirement to separately present items that are of an unusual nature or occur infrequently on a pre-tax basis within income from continuing operations has been retained and was expanded to include items that are both unusual and infrequent. These items may be presented in the income statement or disclosed in the footnotes to the financial statements. The guidance is effective for periods beginning after December 15, 2015. Early adoption is permitted, but only as of the beginning of the fiscal year of adoption. We expect our adoption of this standard to have no impact on our financial position, results of operations, cash flows, or disclosures. | ||
In August 2014, the FASB issued a new standard that requires an entity to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern. Management's evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date that the financial statements are issued. Under this new standard, substantial doubt exists when it is probable that the entity will be unable to meet its obligations as they become due within one year of the date the financial statements are issued. If applicable, certain disclosures are required, including management's plans to mitigate those relevant conditions or events to alleviate the substantial doubt. This standard is effective for annual periods and interim periods within those annual periods ending after December 15, 2016. Early adoption is permitted. We expect our adoption of this standard to have no impact on our financial position, results of operations, cash flows, or disclosures. | ||
In June 2014, the FASB revised guidance on share-based compensation awards that require a specific performance target to be achieved in order for the awards to vest. This revised guidance requires that a performance target that impacts vesting and can be achieved after the requisite service period be treated as a performance condition. As such, a performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that a performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. The revised guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and can be applied either (i) prospectively to all awards granted or modified after the effective date or (ii) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. We do not anticipate our adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
In May 2014, the FASB issued revised guidance on revenue recognition. This revised guidance provides a single comprehensive model for accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This revised guidance will require an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update creates a five-step model that requires entities to exercise judgment when considering the terms of contract(s), which includes (i) identifying the contract(s) with the customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the separate performance obligations, and (v) recognizing revenue when each performance obligation is satisfied. This revised guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including qualitative and quantitative information about contracts with customers, significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This revised guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those years, and can be applied retrospectively either to each prior reporting period presented or with the cumulative effect of adoption recognized at the date of initial application. Early adoption is not permitted. We are evaluating the impact adoption of this revised guidance will have on our financial position, results of operations, cash flows, or disclosures. Based on the information that we have evaluated to date, we do not anticipate the adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
In April 2014, the FASB issued revised guidance on reporting discontinued operations. This revised guidance defines a discontinued operation as a disposal of a component or a group of components of an entity that represents a strategic shift that has (or will have) a major effect on the entity's operations and financial results. This revised guidance also requires additional disclosures for discontinued operations and new disclosures for individually material disposal transactions that do not meet the definition of a discontinued operation. This revised guidance is effective for fiscal years beginning on or after December 15, 2014 and interim periods within those years, with earlier adoption permitted. We do not anticipate the adoption of this revised guidance to have a significant impact on our financial position, results of operations, cash flows, or disclosures. | ||
DISCONTINUED_OPERATIONS_AND_SA1
DISCONTINUED OPERATIONS AND SALE OF ASSETS (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Discontinued Operations, Exit/Sale of Product Lines, Sale of Assets and Assets Held for Sale | |||||||||||
The results of discontinued operations and loss on sale | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales | $ | – | $ | 380.4 | $ | 912.3 | |||||
| | | | | | | | | | | |
(Loss) income before taxes, including divestiture-related and restructuring costs | $ | – | $ | (12.4 | ) | $ | 86.4 | ||||
Provision for income taxes | – | (.1 | ) | (28.6 | ) | ||||||
| | | | | | | | | | | |
(Loss) income from discontinued operations, net of tax before loss on sale | – | (12.5 | ) | 57.8 | |||||||
(Loss) gain on sale before taxes | (3.3 | ) | 49.4 | – | |||||||
Tax benefit (provision) on sale | 1.1 | (65.4 | ) | – | |||||||
| | | | | | | | | | | |
(Loss) income from discontinued operations, net of tax | $ | (2.2 | ) | $ | (28.5 | ) | $ | 57.8 | |||
| | | | | | | | | | | |
GOODWILL_AND_OTHER_INTANGIBLES1
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS (Tables) | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Goodwill and Other Intangibles Resulting from Business Acquisitions | ||||||||||||||||||||
Changes in net carrying amount of goodwill | ||||||||||||||||||||
(In millions) | Pressure- | Retail | Other | Total | ||||||||||||||||
sensitive | Branding and | specialty | ||||||||||||||||||
Materials | Information | converting | ||||||||||||||||||
Solutions | businesses | |||||||||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of December 29, 2012 | $ | 338.3 | $ | 422.6 | $ | 3.5 | $ | 764.4 | ||||||||||||
Divestiture (1) | – | – | (3.5 | ) | (3.5 | ) | ||||||||||||||
Acquisition adjustments | – | (.2 | ) | – | (.2 | ) | ||||||||||||||
Translation adjustments | (3.9 | ) | (5.7 | ) | – | (9.6 | ) | |||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of December 28, 2013 | 334.4 | 416.7 | – | 751.1 | ||||||||||||||||
Acquisition adjustments (2) | 0.4 | 7 | – | 7.4 | ||||||||||||||||
Translation adjustments | (28.2 | ) | (8.7 | ) | – | (36.9 | ) | |||||||||||||
| | | | | | | | | | | | | | |||||||
Goodwill as of January 3, 2015 | $ | 306.6 | $ | 415 | $ | – | $ | 721.6 | ||||||||||||
| | | | | | | | | | | | | | |||||||
-1 | See Note 2, "Discontinued Operations and Sale of Assets," for more information. | |||||||||||||||||||
-2 | Acquisition adjustments related to deferred taxes from previous acquisitions. See Note 14, "Taxes Based on Income," for more information. | |||||||||||||||||||
Finite-Lived Intangible Assets | ||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||
(In millions) | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||
Carrying | Amortization | Carrying | Carrying | Amortization | Carrying | |||||||||||||||
Amount | Amount | Amount | Amount | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Customer relationships | $ | 228.9 | $ | 180.2 | $ | 48.7 | $ | 234.1 | $ | 164.6 | $ | 69.5 | ||||||||
Patents and other acquired technology | 49.0 | 42.7 | 6.3 | 48.9 | 38.3 | 10.6 | ||||||||||||||
Trade names and trademarks | 24.0 | 20.5 | 3.5 | 26.2 | 22.5 | 3.7 | ||||||||||||||
Other intangibles | 12.3 | 11.3 | 1.0 | 12.4 | 11.1 | 1.3 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 314.2 | $ | 254.7 | $ | 59.5 | $ | 321.6 | $ | 236.5 | $ | 85.1 | ||||||||
| | | | | | | | | | | | | | | | | | | | |
Future amortization expense for finite lived intangible assets | ||||||||||||||||||||
(In millions) | Estimated | |||||||||||||||||||
Amortization | ||||||||||||||||||||
Expense | ||||||||||||||||||||
| | | | | ||||||||||||||||
2015 | $ | 20.8 | ||||||||||||||||||
2016 | 19.0 | |||||||||||||||||||
2017 | 9.9 | |||||||||||||||||||
2018 | 2.4 | |||||||||||||||||||
2019 | 1.8 | |||||||||||||||||||
| | | | | ||||||||||||||||
DEBT_AND_CAPITAL_LEASES_Tables
DEBT AND CAPITAL LEASES (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Debt | ||||||||
Schedule of long-term debt, including its respective interest rates, and capital lease obligations | ||||||||
(In millions) | 2014 | 2013 | ||||||
| | | | | | | | |
Long-term debt and capital leases | ||||||||
Medium-term notes: | ||||||||
Series 1995 due 2015 through 2025 | $ | 50 | $ | 50 | ||||
Long-term notes | ||||||||
Senior notes due 2017 at 6.6% | 249.6 | 249.6 | ||||||
Senior notes due 2020 at 5.4% | 249.9 | 249.9 | ||||||
Senior notes due 2023 at 3.4% | 249.7 | 249.7 | ||||||
Senior notes due 2033 at 6.0% | 150 | 150 | ||||||
Capital lease obligations | 1.8 | 3 | ||||||
Less amount classified as current | (5.7 | ) | (1.6 | ) | ||||
| | | | | | | | |
Total long-term debt and capital leases | $ | 945.3 | $ | 950.6 | ||||
| | | | | | | | |
Schedule of maturities of long-term debt and capital leases for each of the next five fiscal years and thereafter | ||||||||
Year | (In millions) | |||||||
| | | | | ||||
2015 (classified as current) | $ | 5.7 | ||||||
2016 | 0.3 | |||||||
2017 | 249.9 | |||||||
2018 | 0.2 | |||||||
2019 | 0.2 | |||||||
2020 and thereafter | 694.7 | |||||||
| | | | | ||||
FINANCIAL_INSTRUMENTS_Tables
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||
Jan. 03, 2015 | |||||||||||||
Financial Instruments | |||||||||||||
Fair value and balance sheet locations of derivatives | The following table provides the fair value and balance sheet locations of derivatives as of January 3, 2015: | ||||||||||||
Asset | Liability | ||||||||||||
(In millions) | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||
| | | | | | | | | | | | ||
Foreign exchange contracts | Other current assets | $ | 10.3 | Other accrued liabilities | $ | 10.5 | |||||||
Commodity contracts | Other current assets | – | Other accrued liabilities | 1.0 | |||||||||
Long-term retirement benefits and other liabilities | 0.2 | ||||||||||||
| | | | | | | | | | | | ||
$ | 10.3 | $ | 11.7 | ||||||||||
| | | | | | | | | | | | ||
The following table provides the fair value and balance sheet locations of derivatives as of December 28, 2013: | |||||||||||||
Asset | Liability | ||||||||||||
(In millions) | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||
Foreign exchange contracts | Other current assets | $ | 3.1 | Other accrued liabilities | $ | 4.7 | |||||||
Commodity contracts | Other current assets | 0.1 | Other accrued liabilities | – | |||||||||
| | | | | | | | | | | | ||
$ | 3.2 | $ | 4.7 | ||||||||||
| | | | | | | | | | | | ||
Components of the gain (loss) recognized in income related to fair value hedge contracts | |||||||||||||
(In millions) | Location of Gain (Loss) in Income | 2014 | 2013 | 2012 | |||||||||
| | | | | | | | | | | | | |
Foreign exchange contracts | Cost of products sold | $ | (1.6 | ) | $ | 2.3 | $ | – | |||||
Foreign exchange contracts | Marketing, general and administrative expense | (43.3 | ) | (35.9 | ) | 17.8 | |||||||
| | | | | | | | | | | | | |
$ | (44.9 | ) | $ | (33.6 | ) | $ | 17.8 | ||||||
| | | | | | | | | | | | | |
Components of the gain (loss) recognized in income related to cash flow hedges | |||||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||||
Foreign exchange contracts | $ | 1.3 | $ | 1.1 | $ | (.9 | ) | ||||||
Commodity contracts | (1.2 | ) | (.1 | ) | (.9 | ) | |||||||
| | | | | | | | | | | | | |
$ | 0.1 | $ | 1 | $ | (1.8 | ) | |||||||
| | | | | | | | | | | | | |
Components of the gain (loss) reclassified from accumulated other comprehensive loss | |||||||||||||
(In millions) | Location of Gain (Loss) in Income | 2014 | 2013 | 2012 | |||||||||
Foreign exchange contracts | Cost of products sold | $ | (1.2 | ) | $ | 0.6 | $ | (2.5 | ) | ||||
Commodity contracts | Cost of products sold | 0.1 | (1.2 | ) | (2.8 | ) | |||||||
Interest rate contracts | Interest expense | (.1 | ) | (.1 | ) | (4.4 | ) | ||||||
| | | | | | | | | | | | | |
$ | (1.2 | ) | $ | (.7 | ) | $ | (9.7 | ) | |||||
| | | | | | | | | | | | | |
PENSION_AND_OTHER_POSTRETIREME1
PENSION AND OTHER POSTRETIREMENT BENEFITS (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Jan. 03, 2015 | |||||||||||||||||||||||||||||
Defined Benefit Plans | |||||||||||||||||||||||||||||
Schedule of one-percentage-point change in assumed health care cost trend rates | |||||||||||||||||||||||||||||
(In millions) | One-percentage-point | One-percentage-point | |||||||||||||||||||||||||||
Increase | Decrease | ||||||||||||||||||||||||||||
Effect on total of service and interest cost components | $ | 0.01 | $ | (.01 | ) | ||||||||||||||||||||||||
Effect on postretirement benefit obligations | 0.4 | (.4 | ) | ||||||||||||||||||||||||||
| | | | | | | | ||||||||||||||||||||||
Schedule of plan benefit obligations | Plan Benefit Obligations | ||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Change in projected benefit obligations | |||||||||||||||||||||||||||||
Projected benefit obligations at beginning of year | $ | 933.7 | $ | 642.8 | $ | 963.7 | $ | 597.6 | $ | 9.1 | $ | 12 | |||||||||||||||||
Service cost | 0.4 | 12.9 | 0.4 | 13 | – | – | |||||||||||||||||||||||
Interest cost | 44.7 | 23.8 | 39.7 | 23.3 | 0.3 | 0.3 | |||||||||||||||||||||||
Participant contribution | – | 4 | – | 4.1 | 1.1 | 1.2 | |||||||||||||||||||||||
Amendments (1) | – | (7.2 | ) | 19.9 | – | – | – | ||||||||||||||||||||||
Actuarial loss (gain) (2) | 141.5 | 166.1 | (59.8 | ) | 8.5 | 0.3 | (.5 | ) | |||||||||||||||||||||
Plan transfers (3) | 21.4 | – | 5.7 | 7.1 | – | – | |||||||||||||||||||||||
Benefits paid | (47.9 | ) | (22.3 | ) | (45.4 | ) | (21.2 | ) | (2.8 | ) | (3.5 | ) | |||||||||||||||||
Curtailments | – | (7.6 | ) | 9.5 | (1.7 | ) | – | (.4 | ) | ||||||||||||||||||||
Settlements | – | (2.2 | ) | – | (6.0 | ) | – | – | |||||||||||||||||||||
Foreign currency translation | – | (73.2 | ) | – | 18.1 | – | – | ||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Projected benefit obligations at end of year | $ | 1,093.80 | $ | 737.1 | $ | 933.7 | $ | 642.8 | $ | 8 | $ | 9.1 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Accumulated benefit obligations at end of year | $ | 1,093.80 | $ | 693.9 | $ | 933.7 | $ | 601.7 | |||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
-1 | Amendments to the international plans in 2014 related to our plans in The Netherlands, U.K. and France. Amendments to the U.S. pension plan in 2013 primarily related to changing the timing for the required benefit elections for participant SHARE Accounts. | ||||||||||||||||||||||||||||
-2 | Actuarial loss (gain) in 2013 included an out-of-period adjustment of $15 million recorded in the fourth quarter of 2013 to properly state the balance sheet pension liability by increasing the projected benefit obligation as a result of a change in the method for projecting SHARE Account asset values. The corresponding adjustment affected other comprehensive income, with no impact to net income in 2013, and is subject to future amortization. The impact of this out-of-period adjustment was not considered material to the 2013 or any previous financial statements. | ||||||||||||||||||||||||||||
-3 | Plan transfers in 2014 and 2013 for the U.S. represented transfers from participant SHARE Accounts. Plan transfers in 2013 for the international plans include transfers in Switzerland and Germany related to the OCP and DES divestitures. | ||||||||||||||||||||||||||||
Schedule of plan assets | Plan Assets | ||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Change in plan assets | |||||||||||||||||||||||||||||
Plan assets at beginning of year | $ | 747.4 | $ | 566.6 | $ | 648.5 | $ | 515 | $ | – | $ | – | |||||||||||||||||
Actual return on plan assets | 52.9 | 117.9 | 61.8 | 26.6 | – | – | |||||||||||||||||||||||
Plan transfers (1) | 21.4 | – | 5.7 | 2.3 | – | – | |||||||||||||||||||||||
Employer contributions | 5.1 | 16 | 76.8 | 28.9 | 1.7 | 2.3 | |||||||||||||||||||||||
Participant contributions | – | 4 | – | 4.1 | 1.1 | 1.2 | |||||||||||||||||||||||
Benefits paid | (47.9 | ) | (22.3 | ) | (45.4 | ) | (21.2 | ) | (2.8 | ) | (3.5 | ) | |||||||||||||||||
Settlements | – | (2.2 | ) | – | (6.0 | ) | – | – | |||||||||||||||||||||
Foreign currency translation | – | (61.9 | ) | – | 16.9 | – | – | ||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Plan assets at end of year | $ | 778.9 | $ | 618.1 | $ | 747.4 | $ | 566.6 | $ | – | $ | – | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
-1 | Plan transfers in 2014 and 2013 for the U.S. represented transfers from participant SHARE Accounts. Plan transfers in 2013 for the international plans include transfers in Switzerland related to the OCP and DES divestitures. | ||||||||||||||||||||||||||||
Schedule of funded status | Funded Status | ||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Funded status of the plans | |||||||||||||||||||||||||||||
Other assets | $ | – | $ | 20 | $ | – | $ | 35.4 | $ | – | $ | – | |||||||||||||||||
Other accrued liabilities | (4.1 | ) | (2.5 | ) | (3.6 | ) | (2.7 | ) | (1.6 | ) | (2.2 | ) | |||||||||||||||||
Long-term retirement benefits and other liabilities | (310.8 | ) | (136.5 | ) | (182.7 | ) | (108.9 | ) | (6.4 | ) | (6.9 | ) | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Plan assets less than benefit obligations | $ | (314.9 | ) | $ | (119.0 | ) | $ | (186.3 | ) | $ | (76.2 | ) | $ | (8.0 | ) | $ | (9.1 | ) | |||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Schedule of Weighted-average assumptions used for determining year-end obligations | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | ||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Weighted-average assumptions used to determine year-end benefit obligations | |||||||||||||||||||||||||||||
Discount rate | 4.00 | % | 2.54 | % | 4.85 | % | 3.88 | % | 4.00 | % | 3.94 | % | 3.50 | % | 3.45 | % | 2.85 | % | |||||||||||
Compensation rate increase | – | 2.22 | – | 2.24 | – | 2.24 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Schedule of pretax amounts, including that of discontinued operations, recognized in accumulated other comprehensive loss | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Net actuarial loss | $ | 590.5 | $ | 174.8 | $ | 466.9 | $ | 129.5 | $ | 24.1 | $ | 26.6 | |||||||||||||||||
Prior service cost (credit) | 19.9 | (5.3 | ) | 21 | 2.5 | (22.9 | ) | (26.2 | ) | ||||||||||||||||||||
Net transition obligation | – | 0.4 | – | 0.5 | – | – | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Net amount recognized in accumulated other comprehensive loss | $ | 610.4 | $ | 169.9 | $ | 487.9 | $ | 132.5 | $ | 1.2 | $ | 0.4 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | ||||||||||
Schedule of pretax amounts, including that of discontinued operations, recognized in other comprehensive loss (income) | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net actuarial loss (gain) | $ | 140.6 | $ | 51.3 | $ | (73.4 | ) | $ | 6.1 | $ | 93.5 | $ | 16.4 | $ | 0.3 | $ | (.9 | ) | $ | 1.7 | |||||||||
Prior service (credit) cost | – | (7.3 | ) | 19.9 | – | – | – | – | – | – | |||||||||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||||||||
Net actuarial loss | (16.8 | ) | (5.6 | ) | (18.6 | ) | (8.0 | ) | (14.9 | ) | (3.3 | ) | (2.8 | ) | (2.5 | ) | (2.7 | ) | |||||||||||
Prior service (cost) credit | (1.2 | ) | (1.0 | ) | (.3 | ) | (.4 | ) | (.4 | ) | (.5 | ) | 3.3 | 17.2 | 4.8 | ||||||||||||||
Net transition asset | – | – | – | 0.1 | – | 0.5 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net amount recognized in other comprehensive loss (income) | $ | 122.6 | $ | 37.4 | $ | (72.4 | ) | $ | (2.2 | ) | $ | 78.2 | $ | 13.1 | $ | 0.8 | $ | 13.8 | $ | 3.8 | |||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Schedule of components of net periodic benefit cost (credit) | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
(In millions) | U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | |||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Service cost | $ | 0.4 | $ | 12.9 | $ | 0.4 | $ | 13 | $ | 0.3 | $ | 9.1 | $ | – | $ | – | $ | – | |||||||||||
Interest cost | 44.7 | 23.8 | 39.7 | 23.3 | 40.3 | 24.5 | 0.3 | 0.3 | 0.5 | ||||||||||||||||||||
Expected return on plan assets | (52.0 | ) | (26.0 | ) | (48.1 | ) | (22.6 | ) | (45.9 | ) | (22.1 | ) | – | – | – | ||||||||||||||
Recognized actuarial loss | 16.2 | 5.2 | 17.7 | 6.3 | 14.3 | 3.1 | 2.8 | 2.5 | 2.7 | ||||||||||||||||||||
Amortization of prior service cost (credit) | 1.2 | 0.4 | 0.3 | 0.5 | 0.4 | 0.4 | (3.3 | ) | (4.1 | ) | (4.8 | ) | |||||||||||||||||
Amortization of transition asset | – | – | – | (.1 | ) | – | (.5 | ) | – | – | – | ||||||||||||||||||
Recognized loss (gain) on curtailment (1) | – | 0.6 | – | (1.5 | ) | – | – | – | – | – | |||||||||||||||||||
Recognized loss on settlement (2) | 0.6 | 0.4 | – | 0.5 | 0.6 | – | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net periodic benefit cost (credit) | $ | 11.1 | $ | 17.3 | $ | 10 | $ | 19.4 | $ | 10 | $ | 14.5 | $ | (.2 | ) | $ | (1.3 | ) | $ | (1.6 | ) | ||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
-1 | Recognized loss on curtailment in 2014 related to a pension plan in The Netherlands and gain on curtailment in 2013 related to a pension plan in Taiwan. These amounts were recorded in "Other expense, net" in the Consolidated Statements of Income. | ||||||||||||||||||||||||||||
-2 | Represented settlement event in Switzerland in 2014. | ||||||||||||||||||||||||||||
Schedule of weighted-average assumptions used for determining net periodic cost | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||||||
U.S. | Int'l | U.S. | Int'l | U.S. | Int'l | ||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Discount rate | 4.85 | % | 3.88 | % | 4.00 | % | 3.94 | % | 4.75 | % | 4.80 | % | 3.45 | % | 2.85 | % | 3.75 | % | |||||||||||
Expected return on assets | 7.75 | 4.82 | 8.00 | 4.78 | 8.00 | 4.95 | – | – | – | ||||||||||||||||||||
Compensation rate increase | – | 2.24 | – | 2.24 | – | 2.79 | – | – | – | ||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Schedule of anticipated future benefit payments | |||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | |||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
2015 | $ | 49.4 | $ | 18.4 | $ | 1.6 | |||||||||||||||||||||||
2016 | 50.1 | 19.3 | 1.2 | ||||||||||||||||||||||||||
2017 | 52.2 | 19.8 | 0.9 | ||||||||||||||||||||||||||
2018 | 68.4 | 20.1 | 0.6 | ||||||||||||||||||||||||||
2019 | 58.2 | 21.1 | 0.5 | ||||||||||||||||||||||||||
2020 –2023 | 294.5 | 119.2 | 1.6 | ||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Schedule of estimated amortization of amounts, included in accumulated other comprehensive loss | Our estimates of fiscal year 2015 amortization of amounts included in "Accumulated other comprehensive loss" are as follows: | ||||||||||||||||||||||||||||
Pension Benefits | U.S. Postretirement | ||||||||||||||||||||||||||||
Health Benefits | |||||||||||||||||||||||||||||
(In millions) | U.S. | Int'l | |||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Net actuarial loss | $ | 20.3 | $ | 10.4 | $ | 2.6 | |||||||||||||||||||||||
Prior service cost (credit) | 1.1 | (.3 | ) | (3.3 | ) | ||||||||||||||||||||||||
Net transition obligation | – | 0.1 | – | ||||||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
Net loss (gain) to be recognized | $ | 21.4 | $ | 10.2 | $ | (.7 | ) | ||||||||||||||||||||||
| | | | | | | | | | | |||||||||||||||||||
U.S.. | |||||||||||||||||||||||||||||
Defined Benefit Plans | |||||||||||||||||||||||||||||
Schedule of fair value of plan assets | The followThe following table sets forth, by level within the fair value hierarchy, U.S. plan assets (all in the ADPP) at fair value as of year-end 2014: | ||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 1.3 | $ | 1.3 | $ | – | $ | – | |||||||||||||||||||||
Liability hedging portfolio | |||||||||||||||||||||||||||||
Pooled funds – Corporate debt/agencies | 152.4 | – | 152.4 | – | |||||||||||||||||||||||||
Pooled funds – Fixed income | 218.7 | – | 218.7 | – | |||||||||||||||||||||||||
Pooled funds – U.S. bonds, other fixed income | 0.4 | – | 0.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total liability hedging portfolio | 371.5 | – | 371.5 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Growth portfolio (1) | |||||||||||||||||||||||||||||
Pooled funds – Global equities | 60.2 | – | 60.2 | – | |||||||||||||||||||||||||
Pooled funds – Global real estate investment trusts | 40.4 | – | 40.4 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 58.2 | – | 58.2 | – | |||||||||||||||||||||||||
Pooled funds – International | 87.5 | – | 87.5 | – | |||||||||||||||||||||||||
Pooled funds – U.S. equities | 99.4 | – | 99.4 | – | |||||||||||||||||||||||||
Pooled funds – Alternative investments | 60.3 | – | – | 60.3 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total growth portfolio | 406.0 | – | 345.7 | 60.3 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets at fair value | $ | 778.8 | $ | 1.3 | $ | 717.2 | $ | 60.3 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (2) | 0.1 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets | $ | 778.9 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | "Pooled funds – International" excludes U.S. equity securities; "Pooled funds – Global equities" includes U.S. equity securities. | ||||||||||||||||||||||||||||
-2 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, U.S. plan assets (all in the ADPP) at fair value as of year-end 2013: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 15.8 | $ | 15.8 | $ | – | $ | – | |||||||||||||||||||||
Liability hedging portfolio | |||||||||||||||||||||||||||||
Pooled funds – Corporate debt/agencies | 332.7 | – | 332.7 | – | |||||||||||||||||||||||||
Pooled funds – U.S. bonds, other fixed income | 0.4 | – | 0.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total liability hedging portfolio | 333.1 | – | 333.1 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Growth portfolio (1) | |||||||||||||||||||||||||||||
Pooled funds – Global equities | 60.0 | – | 60.0 | – | |||||||||||||||||||||||||
Pooled funds – Global real estate investment trusts | 45.8 | – | 45.8 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 65.2 | – | 65.2 | – | |||||||||||||||||||||||||
Pooled funds – International | 86.6 | – | 86.6 | – | |||||||||||||||||||||||||
Pooled funds – U.S. equities | 89.5 | – | 89.5 | – | |||||||||||||||||||||||||
Pooled funds – Alternative investments | 51.2 | – | – | 51.2 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total growth portfolio | 398.3 | – | 347.1 | 51.2 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets at fair value | $ | 747.2 | $ | 15.8 | $ | 680.2 | $ | 51.2 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (2) | 0.2 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total U.S. plan assets | $ | 747.4 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | "Pooled funds – International" excludes U.S. equity securities; "Pooled funds – Global equities" includes U.S. equity securities. | ||||||||||||||||||||||||||||
-2 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
Schedule of reconciliation of Level 3 assets | |||||||||||||||||||||||||||||
Level 3 Assets | |||||||||||||||||||||||||||||
(In millions) | Pooled Funds – | ||||||||||||||||||||||||||||
Alternative | |||||||||||||||||||||||||||||
Investments | |||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at December 28, 2013 | $ | 51.2 | |||||||||||||||||||||||||||
Net realized and unrealized gain | 2.7 | ||||||||||||||||||||||||||||
Purchases | 6.4 | ||||||||||||||||||||||||||||
Settlements | – | ||||||||||||||||||||||||||||
Impact of changes in foreign currency exchange rates | – | ||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at January 3, 2015 | $ | 60.3 | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Int'l | |||||||||||||||||||||||||||||
Defined Benefit Plans | |||||||||||||||||||||||||||||
Schedule of fair value of plan assets | The following table sets forth, by level within the fair value hierarchy, international plan assets at fair value as of year-end 2014: | ||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 0.6 | $ | 0.6 | $ | – | $ | – | |||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||
Mutual funds | 0.3 | 0.3 | – | – | |||||||||||||||||||||||||
Pooled funds – Emerging markets bonds | 6.7 | – | 6.7 | – | |||||||||||||||||||||||||
Pooled funds – European bonds | 243.5 | – | 243.5 | – | |||||||||||||||||||||||||
Pooled funds – U.K. bonds | 66.4 | – | 66.4 | – | |||||||||||||||||||||||||
Pooled funds – Global bonds | 3.4 | – | 3.4 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 6.5 | – | 6.5 | – | |||||||||||||||||||||||||
Pooled funds – Enhanced yield bonds | 1.9 | – | 1.9 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total fixed income securities | 328.7 | 0.3 | 328.4 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Pooled funds – Emerging markets | 22.3 | – | 22.3 | – | |||||||||||||||||||||||||
Pooled funds – U.K. | 16.2 | – | 16.2 | – | |||||||||||||||||||||||||
Pooled funds – Global | 160.2 | – | 160.2 | – | |||||||||||||||||||||||||
Pooled funds – Real estate investment trusts | 32.0 | – | 32.0 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total equity securities | 230.7 | – | 230.7 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other investments | |||||||||||||||||||||||||||||
Pooled funds – Commodities | 8.4 | – | 8.4 | – | |||||||||||||||||||||||||
Pooled funds – Real estate | 8.5 | – | 8.5 | – | |||||||||||||||||||||||||
Pooled funds – Other | 16.6 | – | 16.6 | – | |||||||||||||||||||||||||
Insurance contracts | 24.6 | – | – | 24.6 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total other investments | 58.1 | – | 33.5 | 24.6 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets at fair value | $ | 618.1 | $ | 0.9 | $ | 592.6 | $ | 24.6 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, international plan assets at fair value as of year-end 2013: | |||||||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | |||||||||||||||||||||||||
Prices | Other | Other | |||||||||||||||||||||||||||
in Active | Observable | Unobservable | |||||||||||||||||||||||||||
Markets | Inputs | Inputs | |||||||||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Asset class | |||||||||||||||||||||||||||||
Cash | $ | 4.7 | $ | 4.7 | $ | – | $ | – | |||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||
Mutual funds | 0.3 | 0.3 | – | – | |||||||||||||||||||||||||
Pooled funds – Emerging markets bonds | 6.2 | – | 6.2 | – | |||||||||||||||||||||||||
Pooled funds – European bonds | 193.8 | – | 193.8 | – | |||||||||||||||||||||||||
Pooled funds – U.K. bonds | 56.6 | – | 56.6 | – | |||||||||||||||||||||||||
Pooled funds – Global bonds | 3.3 | – | 3.3 | – | |||||||||||||||||||||||||
Pooled funds – High yield bonds | 6.7 | – | 6.7 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total fixed income securities | 266.9 | 0.3 | 266.6 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Equity securities | |||||||||||||||||||||||||||||
Pooled funds – Emerging markets | 20.9 | – | 20.9 | – | |||||||||||||||||||||||||
Pooled funds – U.K. | 17.2 | – | 17.2 | – | |||||||||||||||||||||||||
Pooled funds – Global | 151.3 | – | 151.3 | – | |||||||||||||||||||||||||
Pooled funds – Real estate investment trusts | 28.8 | – | 28.8 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total equity securities | 218.2 | – | 218.2 | – | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other investments | |||||||||||||||||||||||||||||
Pooled funds – Commodities | 9.5 | – | 9.5 | – | |||||||||||||||||||||||||
Pooled funds – Real estate | 7.7 | – | 7.7 | – | |||||||||||||||||||||||||
Pooled funds – Other | 31.7 | – | 31.7 | – | |||||||||||||||||||||||||
Insurance contracts | 27.4 | – | – | 27.4 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total other investments | 76.3 | – | 48.9 | 27.4 | |||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets at fair value | $ | 566.1 | $ | 5.0 | $ | 533.7 | $ | 27.4 | |||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Other assets (1) | 0.5 | ||||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
Total international plan assets | $ | 566.6 | |||||||||||||||||||||||||||
| | | | | | | | | | | | | | ||||||||||||||||
-1 | Includes accrued recoverable taxes. | ||||||||||||||||||||||||||||
Schedule of reconciliation of Level 3 assets | |||||||||||||||||||||||||||||
Level 3 Assets | |||||||||||||||||||||||||||||
(In millions) | Insurance Contracts | ||||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at December 28, 2013 | $ | 27.4 | |||||||||||||||||||||||||||
Net realized and unrealized gain | 0.6 | ||||||||||||||||||||||||||||
Purchases | 2.3 | ||||||||||||||||||||||||||||
Settlements | (2.9 | ) | |||||||||||||||||||||||||||
Impact of changes in foreign currency exchange rates | (2.8 | ) | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
Balance at January 3, 2015 | $ | 24.6 | |||||||||||||||||||||||||||
| | | | | |||||||||||||||||||||||||
COMMITMENTS_Tables
COMMITMENTS (Tables) | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Commitments and Contingencies | |||||
Minimum annual rental commitments on operating leases | |||||
Year | (In millions) | ||||
| | | | | |
2015 | $ | 50.9 | |||
2016 | 37.4 | ||||
2017 | 22.3 | ||||
2018 | 13.6 | ||||
2019 | 10.3 | ||||
2020 and thereafter | 39.3 | ||||
| | | | | |
Total minimum lease payments | $ | 173.8 | |||
| | | | | |
CONTINGENCIES_Tables
CONTINGENCIES (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
CONTINGENCIES | ||||||||
Costs of Environmental Liabilities with Remediation | ||||||||
(In millions) | 2014 | 2013 | ||||||
| | | | | | | | |
Balance at beginning of year | $ | 29.6 | $ | 32.5 | ||||
Charges (reversals), net | 1.7 | 4.6 | ||||||
Payments | (5.1 | ) | (7.5 | ) | ||||
| | | | | | | | |
Balance at end of year | $ | 26.2 | $ | 29.6 | ||||
| | | | | | | | |
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Fair Value Measurements | ||||||||||||||
Assets and liabilities carried at fair value, measured on a recurring basis | The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of January 3, 2015: | |||||||||||||
Fair Value Measurements Using | ||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | ||||||||||
Prices | Other | Other | ||||||||||||
in Active | Observable | Unobservable | ||||||||||||
Markets | Inputs | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
| | | | | | | | | | | | | | |
Assets | ||||||||||||||
Trading securities | $ | 17.9 | $ | 7.6 | $ | 10.3 | $ | – | ||||||
Derivative assets | 10.3 | – | 10.3 | – | ||||||||||
Liabilities | ||||||||||||||
Derivative liabilities | $ | 11.7 | $ | 1.2 | $ | 10.5 | $ | – | ||||||
| | | | | | | | | | | | | | |
The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of December 28, 2013: | ||||||||||||||
Fair Value Measurements Using | ||||||||||||||
(In millions) | Total | Quoted | Significant | Significant | ||||||||||
Prices | Other | Other | ||||||||||||
in Active | Observable | Unobservable | ||||||||||||
Markets | Inputs | Inputs | ||||||||||||
(Level 1) | (Level 2) | (Level 3) | ||||||||||||
| | | | | | | | | | | | | | |
Assets | ||||||||||||||
Trading securities | $ | 17.7 | $ | 7.6 | $ | 10.1 | $ | – | ||||||
Short-term investments | 114.5 | – | 114.5 | – | ||||||||||
Derivative assets | 3.2 | 0.1 | 3.1 | – | ||||||||||
Liabilities | ||||||||||||||
Derivative liabilities | $ | 4.7 | $ | – | $ | 4.7 | $ | – | ||||||
| | | | | | | | | | | | | | |
NET_INCOME_PER_SHARE_Tables
NET INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Jan. 03, 2015 | |||||||||||||
Net Income Per Share | |||||||||||||
Schedule of net income per common share | |||||||||||||
(In millions, except per share amounts) | 2014 | 2013 | 2012 | ||||||||||
| | | | | | | | | | | | | |
(A) | Income from continuing operations | $ | 251.1 | $ | 244.3 | $ | 157.6 | ||||||
(B) | (Loss) income from discontinued operations, net of tax | (2.2 | ) | (28.5 | ) | 57.8 | |||||||
| | | | | | | | | | | | | |
(C) | Net income available to common shareholders | $ | 248.9 | $ | 215.8 | $ | 215.4 | ||||||
| | | | | | | | | | | | | |
(D) | Weighted-average number of common shares outstanding | 93.8 | 98.4 | 102.6 | |||||||||
| | | | | | | | | | | | | |
Dilutive shares (additional common shares issuable under stock-based awards) | 1.9 | 1.7 | 0.9 | ||||||||||
| | | | | | | | | | | | | |
(E) | Weighted-average number of common shares outstanding, assuming dilution | 95.7 | 100.1 | 103.5 | |||||||||
| | | | | | | | | | | | | |
Net income (loss) per common share: | |||||||||||||
Continuing operations (A) ÷ (D) | $ | 2.68 | $ | 2.48 | $ | 1.54 | |||||||
Discontinued operations (B) ÷ (D) | (.03 | ) | (.29 | ) | 0.56 | ||||||||
| | | | | | | | | | | | | |
Net income per common share | $ | 2.65 | $ | 2.19 | $ | 2.1 | |||||||
(C) ÷ (D) | |||||||||||||
| | | | | | | | | | | | | |
Net income (loss) per common share, assuming dilution: | |||||||||||||
Continuing operations (A) ÷ (E) | $ | 2.62 | $ | 2.44 | $ | 1.52 | |||||||
Discontinued operations (B) ÷ (E) | (.02 | ) | (.28 | ) | 0.56 | ||||||||
| | | | | | | | | | | | | |
Net income per common share, | $ | 2.6 | $ | 2.16 | $ | 2.08 | |||||||
assuming dilution (C) ÷ (E) | |||||||||||||
| | | | | | | | | | | | | |
SUPPLEMENTAL_EQUITY_AND_COMPRE1
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Comprehensive Income | ||||||||||||||
Schedule of changes in "Accumulated other comprehensive loss" (net of tax) | ||||||||||||||
(In millions) | Foreign | Pension and | Cash Flow | Total | ||||||||||
Currency | Other | Hedges | ||||||||||||
Translation | Postretirement | |||||||||||||
Benefits | ||||||||||||||
| | | | | | | | | | | | | | |
Balance as of December 29, 2012 | $ | 180.5 | $ | (456.5 | ) | $ | (2.0 | ) | $ | (278.0 | ) | |||
Other comprehensive income (loss) before reclassifications, net of tax | (53.3 | ) | 29.4 | 0.8 | (23.1 | ) | ||||||||
Reclassifications to net income, net of tax | 10.8 | 9 | 0.2 | 20 | ||||||||||
| | | | | | | | | | | | | | |
Net current-period other comprehensive income (loss), net of tax | (42.5 | ) | 38.4 | 1 | (3.1 | ) | ||||||||
| | | | | | | | | | | | | | |
Balance as of December 28, 2013 | $ | 138 | $ | (418.1 | ) | $ | (1.0 | ) | $ | (281.1 | ) | |||
Other comprehensive income (loss) before reclassifications, net of tax | (154.7 | ) | (129.4 | ) | 0.1 | (284.0 | ) | |||||||
Reclassifications to net income, net of tax | – | 16.9 | 0.9 | 17.8 | ||||||||||
| | | | | | | | | | | | | | |
Net current-period other comprehensive income (loss), net of tax | (154.7 | ) | (112.5 | ) | 1 | (266.2 | ) | |||||||
| | | | | | | | | | | | | | |
Balance as of January 3, 2015 | $ | (16.7 | ) | $ | (530.6 | ) | $ | – | $ | (547.3 | ) | |||
| | | | | | | | | | | | | | |
Schedule of amounts reclassified from "Accumulated other comprehensive loss" to increase (decrease) income from continuing operations | ||||||||||||||
(In millions) | 2014 | 2013 | Affected Line Item in the | |||||||||||
Statement Where Net | ||||||||||||||
Income is Presented | ||||||||||||||
| | | | | | | | | ||||||
Cash flow hedges: | ||||||||||||||
Foreign exchange contracts | $ | (1.2 | ) | $ | 0.6 | Cost of products sold | ||||||||
Commodity contracts | 0.1 | (1.2 | ) | Cost of products sold | ||||||||||
Interest rate contracts | (.1 | ) | (.1 | ) | Interest expense | |||||||||
| | | | | | | | | ||||||
(1.2 | ) | (.7 | ) | Total before tax | ||||||||||
0.3 | 0.2 | Provision for income taxes | ||||||||||||
| | | | | | | | | ||||||
(.9 | ) | (.5 | ) | Net of tax | ||||||||||
Pension and other postretirement benefits (1) | (24.1 | ) | (23.5 | ) | ||||||||||
7.2 | 7.8 | Provision for income taxes | ||||||||||||
| | | | | | | | | ||||||
(16.9 | ) | (15.7 | ) | Net of tax | ||||||||||
| | | | | | | | | ||||||
Total reclassifications for the period | $ | (17.8 | ) | $ | (16.2 | ) | Total, net of tax | |||||||
| | | | | | | | | ||||||
-1 | See Note 6, "Pension and Other Postretirement Benefits," for more information. | |||||||||||||
Income tax expense (benefit) allocated to each component of other comprehensive loss (income): | ||||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||||
| | | | | | | | | | | ||||
Foreign currency translation | $ | – | $ | – | $ | 0.9 | ||||||||
Pension and other postretirement benefits: | ||||||||||||||
Net actuarial (loss) gain | (56.6 | ) | 26.4 | (38.3 | ) | |||||||||
Prior service credit (cost) | 1.1 | (7.5 | ) | – | ||||||||||
Reclassifications to net income: | ||||||||||||||
Amortization of net actuarial loss | 7.5 | 9.4 | 6.9 | |||||||||||
Amortization of prior service credit | (.7 | ) | (1.3 | ) | (1.5 | ) | ||||||||
Amortization of transition asset | – | – | (.1 | ) | ||||||||||
Net curtailment of pension and post-retirement benefit obligations | 0.1 | (4.8 | ) | – | ||||||||||
Settlement of pension obligations | 0.3 | 0.6 | 0.2 | |||||||||||
Cash flow hedges: | ||||||||||||||
Losses (gains) recognized on cash flow hedges | 0.1 | 0.2 | (.7 | ) | ||||||||||
Reclassifications to net income | 0.3 | 0.1 | 3.7 | |||||||||||
| | | | | | | | | | | ||||
Income tax (benefit) expense related to items of other comprehensive (loss) income | $ | (47.9 | ) | $ | 23.1 | $ | (28.9 | ) | ||||||
| | | | | | | | | | | ||||
LONGTERM_INCENTIVE_COMPENSATIO1
LONG-TERM INCENTIVE COMPENSATION (Tables) | 12 Months Ended | |||||||||||
Jan. 03, 2015 | ||||||||||||
Long-Term Incentive Compensation | ||||||||||||
Summary of stock-based compensation expense from continuing operations and the total recognized tax benefit related to this expense | ||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||
| | | | | | | | | | | ||
Stock-based compensation expense | $ | 28.3 | $ | 32.3 | $ | 35.8 | ||||||
Tax benefit | 10.5 | 10.8 | 12.5 | |||||||||
| | | | | | | | | | | ||
Schedule of weighted-average assumptions of options granted during the year | ||||||||||||
2013 | 2012 | |||||||||||
| | | | | | | | |||||
Risk-free interest rate | 1.04 | % | 1.82 | % | ||||||||
Expected stock price volatility | 27.17 | % | 32.81 | % | ||||||||
Expected dividend yield | 3.40 | % | 3.30 | % | ||||||||
Expected option term | 6.2 years | 6.0 years | ||||||||||
| | | | | | | | |||||
Schedule of stock option activity | ||||||||||||
Number | Weighted-average | Weighted-average | Aggregate | |||||||||
of options | exercise price | remaining | intrinsic value | |||||||||
(in thousands) | contractual life | (in millions) | ||||||||||
(in years) | ||||||||||||
| | | | | | | | | | | | |
Outstanding at December 28, 2013 | 7,891.20 | $ | 45.85 | 4.27 | $ | 69 | ||||||
Exercised | (1,009.2 | ) | 34.14 | |||||||||
Forfeited or expired | (1,703.4 | ) | 58.17 | |||||||||
| | | | | | | | | | | | |
Outstanding at January 3, 2015 | 5,178.60 | $ | 44.08 | 3.95 | $ | 54.6 | ||||||
Options vested and expected to vest at January 3, 2015 | 5,134.50 | 44.19 | 3.95 | 53.7 | ||||||||
Options exercisable at January 3, 2015 | 4,444.20 | $ | 45.89 | 3.51 | $ | 40.9 | ||||||
| | | | | | | | | | | | |
Performance Units (PUs) | ||||||||||||
Stock-Based Compensation | ||||||||||||
Information related to awarded PUs | ||||||||||||
Number of | Weighted- | |||||||||||
PUs | average | |||||||||||
(in thousands) | grant-date | |||||||||||
fair value | ||||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 795.2 | $ | 41.32 | |||||||||
Granted at target | 183.6 | 47.85 | ||||||||||
Forfeited/cancelled | (288.9 | ) | 41.59 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 689.9 | $ | 40.16 | |||||||||
| | | | | | | | |||||
Market-leveraged stock units (MSUs) | ||||||||||||
Stock-Based Compensation | ||||||||||||
Information related to awarded RSUs | ||||||||||||
Number of | Weighted- | |||||||||||
MSUs | average | |||||||||||
(in thousands) | grant-date | |||||||||||
fair value | ||||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 330.1 | $ | 51.4 | |||||||||
Granted at target | 338.1 | 52.76 | ||||||||||
Adjustment for above-target performance (1) | 33.3 | 51.4 | ||||||||||
Vested | (109.6 | ) | 51.4 | |||||||||
Forfeited/cancelled | (40.1 | ) | 53.11 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 551.8 | $ | 52.18 | |||||||||
| | | | | | | | |||||
-1 | Reflects adjustment as a result of achieving above-target performance for vesting of the tranche paid out in 2014. | |||||||||||
Restricted Stock Units (RSUs) | ||||||||||||
Stock-Based Compensation | ||||||||||||
Summary of information related to awarded | ||||||||||||
Number of RSUs (in thousands) | Weighted-average grant-date fair value | |||||||||||
| | | | | | | | |||||
Unvested at December 28, 2013 | 681 | $ | 31.06 | |||||||||
Granted | 48.9 | 45.91 | ||||||||||
Vested | (301.1 | ) | 31.41 | |||||||||
Forfeited/cancelled | (40.8 | ) | 31.53 | |||||||||
| | | | | | | | |||||
Unvested at January 3, 2015 | 388 | $ | 32.7 | |||||||||
| | | | | | | | |||||
COST_REDUCTION_ACTIONS_Tables
COST REDUCTION ACTIONS (Tables) | 12 Months Ended | |||||||||||||||||||
Jan. 03, 2015 | ||||||||||||||||||||
Cost Reduction Actions | ||||||||||||||||||||
Restructuring charges and payments | During 2014, restructuring charges and payments were as follows: | |||||||||||||||||||
(In millions) | Accrual at | Charges | Cash | Non-cash | Foreign | Accrual at | ||||||||||||||
December 28, | (Reversals), | Payments | Impairment | Currency | January 3, | |||||||||||||||
2013 | net | Translation | 2015 | |||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
2014 Actions | ||||||||||||||||||||
Severance and related costs | $ | – | $ | 55.1 | $ | (35.6 | ) | $ | – | $ | (2.7 | ) | $ | 16.8 | ||||||
Asset impairment charges | – | 10.8 | – | (10.8 | ) | – | – | |||||||||||||
Lease cancellation costs | – | 0.6 | (.5 | ) | – | – | 0.1 | |||||||||||||
2012 Program | ||||||||||||||||||||
Severance and related costs | 6.6 | (.4 | ) | (5.2 | ) | – | (.2 | ) | 0.8 | |||||||||||
Lease and other contract cancellation costs | 0.2 | – | (.2 | ) | – | – | – | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 6.8 | $ | 66.1 | $ | (41.5 | ) | $ | (10.8 | ) | $ | (2.9 | ) | $ | 17.7 | |||||
| | | | | | | | | | | | | | | | | | | | |
During 2013, restructuring charges and payments were as follows: | ||||||||||||||||||||
(In millions) | Accrual at | Charges, | Cash | Non-cash | Foreign | Accrual at | ||||||||||||||
December 29, | net | Payments | Impairment | Currency | December 28, | |||||||||||||||
2012 | Translation | 2013 | ||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |
2012 Program | ||||||||||||||||||||
Severance and related costs | $ | 20.7 | $ | 27.2 | $ | (41.0 | ) | $ | – | $ | (.3 | ) | $ | 6.6 | ||||||
Lease and other contract cancellation costs | 0.1 | 3.4 | (3.3 | ) | – | – | 0.2 | |||||||||||||
Asset impairment charges | – | 9.7 | – | (9.7 | ) | – | – | |||||||||||||
2011 Actions | ||||||||||||||||||||
Severance and related costs | 0.1 | – | (.1 | ) | – | – | – | |||||||||||||
| | | | | | | | | | | | | | | | | | | | |
Total | $ | 20.9 | $ | 40.3 | $ | (44.4 | ) | $ | (9.7 | ) | $ | (.3 | ) | $ | 6.8 | |||||
| | | | | | | | | | | | | | | | | | | | |
Total amount of restructuring costs incurred by reportable segment and Corporate | ||||||||||||||||||||
(In millions) | 2014 | 2013 | 2012 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Restructuring costs by reportable segment and Corporate | ||||||||||||||||||||
Pressure-sensitive Materials | $ | 40.2 | $ | 10.8 | $ | 34.1 | ||||||||||||||
Retail Branding and Information Solutions | 21.3 | 28.5 | 17.8 | |||||||||||||||||
Vancive Medical Technologies | 4.2 | 0.1 | 0.9 | |||||||||||||||||
Corporate | 0.4 | 0.9 | 3.0 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Continuing operations | 66.1 | 40.3 | 55.8 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Discontinued operations | – | – | 0.6 | |||||||||||||||||
| | | | | | | | | | | ||||||||||
Total | $ | 66.1 | $ | 40.3 | $ | 56.4 | ||||||||||||||
| | | | | | | | | | | ||||||||||
TAXES_BASED_ON_INCOME_Tables
TAXES BASED ON INCOME (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Taxes Based on Income | |||||||||||
Taxes based on Income (loss) | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Current: | |||||||||||
U.S. federal tax | $ | 14.5 | $ | 1.9 | $ | (18.7 | ) | ||||
State taxes | (.2 | ) | 0.3 | (2.4 | ) | ||||||
International taxes | 115 | 107.3 | 101.2 | ||||||||
| | | | | | | | | | | |
129.3 | 109.5 | 80.1 | |||||||||
| | | | | | | | | | | |
Deferred: | |||||||||||
U.S. federal tax | (21.4 | ) | (11.2 | ) | 9.5 | ||||||
State taxes | 8 | 1.3 | (9.3 | ) | |||||||
International taxes | (2.6 | ) | 19.2 | (.3 | ) | ||||||
| | | | | | | | | | | |
(16.0 | ) | 9.3 | (.1 | ) | |||||||
| | | | | | | | | | | |
Provision for income taxes | $ | 113.3 | $ | 118.8 | $ | 80 | |||||
| | | | | | | | | | | |
The principal item accounting for the difference between taxes | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Computed tax at 35% of income before taxes | $ | 127.5 | $ | 127.1 | $ | 83.1 | |||||
Increase (decrease) in taxes resulting from: | |||||||||||
State taxes, net of federal tax benefit | 1.4 | 2.4 | 1.1 | ||||||||
Foreign earnings taxed at different rates (1)(2) | (15.9 | ) | (14.7 | ) | 11.8 | ||||||
Valuation allowance | 16 | (4.3 | ) | (23.6 | ) | ||||||
Corporate owned life insurance | (4.2 | ) | (6.9 | ) | (5.5 | ) | |||||
U.S. federal research and development tax credits | (1.6 | ) | (7.0 | ) | – | ||||||
Tax contingencies and audit settlements | (2.7 | ) | 23.1 | 9.4 | |||||||
Expiration of carryforward items | 1.4 | 2.5 | 4.8 | ||||||||
Other items, net | (8.6 | ) | (3.4 | ) | (1.1 | ) | |||||
| | | | | | | | | | | |
Provision for income taxes | $ | 113.3 | $ | 118.8 | $ | 80 | |||||
| | | | | | | | | | | |
-1 | Included foreign earnings taxed in the U.S., net of credits, for all years. | ||||||||||
-2 | Included $12.1 million and $11.2 million of expense related to the accrual of U.S. taxes on certain foreign earnings for 2013 and 2012, respectively. For 2014, there was no such accrual. | ||||||||||
Income (loss) from continuing operations before taxes from our U.S. and international operations | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
U.S. | $ | 3.5 | $ | (36.2 | ) | $ | (125.7 | ) | |||
International | 360.9 | 399.3 | 363.3 | ||||||||
| | | | | | | | | | | |
Income from continuing operations before taxes | $ | 364.4 | $ | 363.1 | $ | 237.6 | |||||
| | | | | | | | | | | |
Components of the temporary differences | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Accrued expenses not currently deductible | $ | 40.7 | $ | 44.7 | |||||||
Net operating losses | 277.7 | 306.2 | |||||||||
Tax credit carryforwards | 104.2 | 129.2 | |||||||||
Postretirement and postemployment benefits | 97.6 | 100.8 | |||||||||
Pension costs | 154 | 95.7 | |||||||||
Inventory reserves | 9.1 | 8.6 | |||||||||
Other assets | 9.2 | 6.2 | |||||||||
Valuation allowance | (75.0 | ) | (59.0 | ) | |||||||
| | | | | | | | ||||
Total deferred tax assets (2) | 617.5 | 632.4 | |||||||||
| | | | | | | | ||||
Depreciation and amortization | (121.8 | ) | (127.8 | ) | |||||||
Repatriation accrual (1) | 1.9 | (52.9 | ) | ||||||||
Foreign operating loss recapture | (118.0 | ) | (136.5 | ) | |||||||
Other liabilities | (3.0 | ) | (1.8 | ) | |||||||
| | | | | | | | ||||
Total deferred tax liabilities (2) | (240.9 | ) | (319.0 | ) | |||||||
| | | | | | | | ||||
Total net deferred tax assets | $ | 376.6 | $ | 313.4 | |||||||
| | | | | | | | ||||
-1 | Included in the repatriation accrual as of January 3, 2015 was a net deferred tax liability of $4.4 million associated with the future tax cost to repatriate non-permanently reinvested earnings of our foreign subsidiaries which is more than offset by a contra deferred tax liability of $6.3 million related to unrealized foreign exchange losses associated with earnings of our foreign subsidiaries that can be repatriated to the U.S. in future periods without incurring any additional U.S. federal income taxes. | ||||||||||
-2 | Reflect gross amounts before jurisdictional netting of deferred tax assets and liabilities. | ||||||||||
Schedule of tax credit and net operating loss carryforwards | |||||||||||
(In millions) | Net Operating | Tax Credits | |||||||||
Losses (1) | |||||||||||
| | | | | | | | ||||
Expires in 2015 | $ | 15.3 | $ | 0.6 | |||||||
Expires in 2016 | 8.1 | 0.7 | |||||||||
Expires in 2017 | 15.5 | 0.4 | |||||||||
Expires in 2018 | 16.5 | 23.9 | |||||||||
Expires in 2019 | 4.6 | 33.2 | |||||||||
Expires in 2020 | 17.7 | 15.9 | |||||||||
Expires in 2021 | 8.2 | 0.3 | |||||||||
Expires in 2022 | 2.8 | 9.6 | |||||||||
Expires in 2023 | 13.7 | 5.2 | |||||||||
Expires in 2024 | 3.3 | 0.3 | |||||||||
Expires in 2025 | – | 0.1 | |||||||||
Expires in 2026 | – | 1.2 | |||||||||
Expires in 2027 | – | 0.1 | |||||||||
Expires in 2028 | – | 0.1 | |||||||||
Expires in 2029 | 1.8 | 0.1 | |||||||||
Expires in 2030 | 0.4 | – | |||||||||
Expires in 2031 | 0.6 | – | |||||||||
Expires in 2032 | 1.1 | – | |||||||||
Expires in 2033 | – | 1.8 | |||||||||
Expires in 2034 | – | 1.6 | |||||||||
Indefinite life/no expiration | 819.1 | 9.1 | |||||||||
| | | | | | | | ||||
Total | $ | 928.7 | $ | 104.2 | |||||||
| | | | | | | | ||||
-1 | Net operating losses are presented before tax effect | ||||||||||
Reconciliation of the beginning and ending amount of unrecognized tax benefits | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Balance at beginning of year | $ | 137.2 | $ | 121.6 | |||||||
Additions based on tax positions related to the current year | 18.2 | 20.1 | |||||||||
Additions for tax positions of prior years | 7.8 | 8.3 | |||||||||
Reductions for tax positions of prior years: | |||||||||||
Changes in judgment | (1.8 | ) | (4.0 | ) | |||||||
Settlements | (15.8 | ) | (2.6 | ) | |||||||
Lapses and statute expirations | (13.8 | ) | (6.2 | ) | |||||||
Changes due to translation of foreign currencies | (9.2 | ) | – | ||||||||
| | | | | | | | ||||
Balance at end of year | $ | 122.6 | $ | 137.2 | |||||||
| | | | | | | | ||||
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Segment Information | |||||||||||
Financial information, by reportable segment from continuing operations | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | |||||||||||
Pressure-sensitive Materials | $ | 4,658.10 | $ | 4,455.00 | $ | 4,257.60 | |||||
Retail Branding and Information Solutions | 1,591.60 | 1,611.10 | 1,535.00 | ||||||||
Vancive Medical Technologies | 80.6 | 73.9 | 70.9 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | $ | 6,330.30 | $ | 6,140.00 | $ | 5,863.50 | |||||
| | | | | | | | | | | |
Intersegment sales | |||||||||||
Pressure-sensitive Materials | $ | 63.2 | $ | 64.6 | $ | 60.9 | |||||
Retail Branding and Information Solutions | 2.4 | 2.4 | 3.8 | ||||||||
Vancive Medical Technologies | 9.6 | 3.6 | 0.8 | ||||||||
| | | | | | | | | | | |
Intersegment sales | $ | 75.2 | $ | 70.6 | $ | 65.5 | |||||
| | | | | | | | | | | |
Income from continuing operations before taxes | |||||||||||
Pressure-sensitive Materials | $ | 434.4 | $ | 442.8 | $ | 359.7 | |||||
Retail Branding and Information Solutions | 87.9 | 81.7 | 53.3 | ||||||||
Vancive Medical Technologies | (11.7 | ) | (8.3 | ) | (16.2 | ) | |||||
Corporate expense | (82.9 | ) | (94.1 | ) | (86.3 | ) | |||||
Interest expense | (63.3 | ) | (59.0 | ) | (72.9 | ) | |||||
| | | | | | | | | | | |
Income from continuing operations before taxes | $ | 364.4 | $ | 363.1 | $ | 237.6 | |||||
| | | | | | | | | | | |
Capital expenditures | |||||||||||
Pressure-sensitive Materials | $ | 110.5 | $ | 81.1 | $ | 64.8 | |||||
Retail Branding and Information Solutions | 39.6 | 42.4 | 24.7 | ||||||||
Vancive Medical Technologies | 2.1 | 1.2 | 3.4 | ||||||||
| | | | | | | | | | | |
Capital expenditures | $ | 152.2 | $ | 124.7 | $ | 92.9 | |||||
| | | | | | | | | | | |
Depreciation and amortization expense | |||||||||||
Pressure-sensitive Materials | $ | 116 | $ | 113.5 | $ | 112.8 | |||||
Retail Branding and Information Solutions | 81.4 | 86.7 | 93.9 | ||||||||
Vancive Medical Technologies | 4.2 | 4.1 | 4.3 | ||||||||
| | | | | | | | | | | |
Depreciation and amortization expense | $ | 201.6 | $ | 204.3 | $ | 211 | |||||
| | | | | | | | | | | |
Other expense, net by reportable segment | |||||||||||
Pressure-sensitive Materials | $ | 41.6 | $ | 10.8 | $ | 33.5 | |||||
Retail Branding and Information Solutions | 22 | 20 | 24.8 | ||||||||
Vancive Medical Technologies | 4.2 | 0.1 | 4.8 | ||||||||
Corporate | 0.4 | 5.7 | 5.7 | ||||||||
| | | | | | | | | | | |
Other expense, net | $ | 68.2 | $ | 36.6 | $ | 68.8 | |||||
| | | | | | | | | | | |
Other expense, net by type | |||||||||||
Restructuring costs: | |||||||||||
Severance and related costs | $ | 54.7 | $ | 27.2 | $ | 49.3 | |||||
Asset impairment charges and lease and other contract cancellation costs | 11.4 | 13.1 | 6.5 | ||||||||
Other items: | |||||||||||
Charitable contribution to Avery Dennison Foundation | – | 10 | – | ||||||||
Indefinite-lived intangible asset impairment charge | 3 | – | 7 | ||||||||
Gain on sale of product line | – | – | (.6 | ) | |||||||
Gains on sales of assets | (2.5 | ) | (17.8 | ) | – | ||||||
Loss (gain) from curtailment and settlement of pension obligation | 1.6 | (1.6 | ) | – | |||||||
Legal settlements | – | 2.5 | – | ||||||||
Product line exits | – | – | 3.9 | ||||||||
Divestiture-related costs (1) | – | 3.2 | 2.7 | ||||||||
| | | | | | | | | | | |
Other expense, net | $ | 68.2 | $ | 36.6 | $ | 68.8 | |||||
| | | | | | | | | | | |
-1 | Represents only the portion allocated to continuing operations. | ||||||||||
Summary of net sales to unaffiliated customers | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | |||||||||||
U.S. | $ | 1,529.4 | $ | 1,537.6 | $ | 1,528.3 | |||||
Europe | 2,074.4 | 1,958.4 | 1,851.1 | ||||||||
Asia | 1,914.2 | 1,823.5 | 1,627.6 | ||||||||
Latin America | 522.9 | 515.6 | 501.2 | ||||||||
Other international | 289.4 | 304.9 | 355.3 | ||||||||
| | | | | | | | | | | |
Net sales to unaffiliated customers | $ | 6,330.3 | $ | 6,140.0 | $ | 5,863.5 | |||||
| | | | | | | | | | | |
Summary of property, plant and equipment, net | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Property, plant and equipment, net | |||||||||||
U.S. | $ | 261.5 | $ | 279.6 | $ | 340.2 | |||||
International | 613.8 | 642.9 | 675.3 | ||||||||
| | | | | | | | | | | |
Property, plant and equipment, net | $ | 875.3 | $ | 922.5 | $ | 1,015.5 | |||||
| | | | | | | | | | | |
SUPPLEMENTAL_FINANCIAL_INFORMA1
SUPPLEMENTAL FINANCIAL INFORMATION (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Supplemental Financial Information [Abstract] | |||||||||||
Net inventories | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Raw materials | $ | 183.6 | $ | 196.3 | |||||||
Work-in-progress | 150.4 | 149.0 | |||||||||
Finished goods | 157.8 | 148.8 | |||||||||
| | | | | | | | ||||
Inventories, net | $ | 491.8 | $ | 494.1 | |||||||
| | | | | | | | ||||
Property, Plant and Equipment | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Land | $ | 32.1 | $ | 47 | |||||||
Buildings and improvements | 578.2 | 580.2 | |||||||||
Machinery and equipment | 1,958.20 | 2,001.30 | |||||||||
Construction-in-progress | 86 | 74.3 | |||||||||
| | | | | | | | ||||
Property, plant and equipment | 2,654.50 | 2,702.80 | |||||||||
Accumulated depreciation | (1,779.2 | ) | (1,780.3 | ) | |||||||
| | | | | | | | ||||
Property, plant and equipment, net | $ | 875.3 | $ | 922.5 | |||||||
| | | | | | | | ||||
Capitalized software costs | |||||||||||
(In millions) | 2014 | 2013 | |||||||||
| | | | | | | | ||||
Cost | $ | 445.7 | $ | 427.9 | |||||||
Accumulated amortization | (293.1 | ) | (264.6 | ) | |||||||
| | | | | | | | ||||
Software, net | $ | 152.6 | $ | 163.3 | |||||||
| | | | | | | | ||||
Schedule of research and development expense | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Research and development expense | $ | 102.5 | $ | 96.0 | $ | 98.6 | |||||
| | | | | | | | | | | |
Cash paid for interest and income taxes | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
| | | | | | | | | | | |
Interest, net of capitalized amounts | $ | 61.6 | $ | 64.1 | $ | 68.0 | |||||
Income taxes, net of refunds | 108.8 | 129.4 | 97.7 | ||||||||
| | | | | | | | | | | |
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (Unaudited) (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
QUARTERLY FINANCIAL INFORMATION (Unaudited) | ||||||||||||||
Quarterly Financial Information | ||||||||||||||
(In millions, except per share data) | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter (1) | |||||||||||
| | | | | | | | | | | | | | |
2014 | ||||||||||||||
Net sales | $ | 1,550.10 | $ | 1,615.80 | $ | 1,559.60 | $ | 1,604.80 | ||||||
Gross profit | 407.2 | 428.2 | 400.7 | 415.1 | ||||||||||
Income from continuing operations | 71.6 | 44.4 | 65 | 70.1 | ||||||||||
(Loss) income from discontinued operations, net of tax | (.4 | ) | (1.9 | ) | (.7 | ) | 0.8 | |||||||
Net income | 71.2 | 42.5 | 64.3 | 70.9 | ||||||||||
Net income (loss) per common share: | ||||||||||||||
Continuing operations | 0.74 | 0.47 | 0.7 | 0.77 | ||||||||||
Discontinued operations | – | (.02 | ) | (.01 | ) | 0.01 | ||||||||
Net income per common share | 0.74 | 0.45 | 0.69 | 0.78 | ||||||||||
Net income (loss) per common share, assuming dilution: | ||||||||||||||
Continuing operations | 0.73 | 0.46 | 0.68 | 0.75 | ||||||||||
Discontinued operations | – | (.02 | ) | – | 0.01 | |||||||||
Net income per common share, assuming dilution | 0.73 | 0.44 | 0.68 | 0.76 | ||||||||||
| | | | | | | | | | | | | | |
2013 | ||||||||||||||
Net sales | $ | 1,498.90 | $ | 1,552.30 | $ | 1,504.90 | $ | 1,583.90 | ||||||
Gross profit | 401.7 | 417.5 | 402.2 | 416.3 | ||||||||||
Income from continuing operations | 66.8 | 70.8 | 62 | 44.7 | ||||||||||
Loss from discontinued operations, net of tax | (9.0 | ) | (2.0 | ) | (15.5 | ) | (2.0 | ) | ||||||
Net income | 57.8 | 68.8 | 46.5 | 42.7 | ||||||||||
Net income (loss) per common share: | ||||||||||||||
Continuing operations | 0.67 | 0.71 | 0.63 | 0.46 | ||||||||||
Discontinued operations | (.09 | ) | (.02 | ) | (.16 | ) | (.02 | ) | ||||||
Net income per common share | 0.58 | 0.69 | 0.47 | 0.44 | ||||||||||
Net income (loss) per common share, assuming dilution: | ||||||||||||||
Continuing operations | 0.66 | 0.7 | 0.62 | 0.45 | ||||||||||
Discontinued operations | (.09 | ) | (.02 | ) | (.15 | ) | (.02 | ) | ||||||
Net income per common share, assuming dilution | 0.57 | 0.68 | 0.47 | 0.43 | ||||||||||
| | | | | | | | | | | | | | |
-1 | Results for the fourth quarter of 2014 reflected the extra week in our 2014 fiscal year. | |||||||||||||
Summary of other expense, net by type for each quarter | ||||||||||||||
(In millions) | First | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | Quarter | |||||||||||
| | | | | | | | | | | | | | |
2014 | ||||||||||||||
Restructuring costs: | ||||||||||||||
Severance and related costs | $ | 7 | $ | 35.9 | $ | 5.1 | $ | 6.7 | ||||||
Asset impairment charges and lease cancellation costs | 0.3 | 2.6 | 1.6 | 6.9 | ||||||||||
Other items: | ||||||||||||||
Indefinite-lived intangible asset impairment charge | – | – | 3 | – | ||||||||||
Gains on sales of assets | – | (.6 | ) | (1.9 | ) | – | ||||||||
Losses from curtailment and settlement of pension obligations | – | 0.6 | – | 1 | ||||||||||
| | | | | | | | | | | | | | |
Other expense, net | $ | 7.3 | $ | 38.5 | $ | 7.8 | $ | 14.6 | ||||||
| | | | | | | | | | | | | | |
2013 | ||||||||||||||
Restructuring costs: | ||||||||||||||
Severance and related costs | $ | 6.8 | $ | 5.4 | $ | 8.7 | $ | 6.3 | ||||||
Asset impairment charges and lease and other contract cancellation costs | 1.3 | 2.4 | 8 | 1.4 | ||||||||||
Other items: | ||||||||||||||
Charitable contribution to Avery Dennison Foundation | – | – | 10 | – | ||||||||||
Gains on sale of assets | (1.3 | ) | (10.9 | ) | (.5 | ) | (5.1 | ) | ||||||
Gain from curtailment of pension obligation | – | – | (1.6 | ) | – | |||||||||
Legal settlement | – | 2.5 | – | – | ||||||||||
Divestiture-related costs (1) | 0.7 | 0.3 | 1.1 | 1.1 | ||||||||||
| | | | | | | | | | | | | | |
Other expense, net | $ | 7.5 | $ | (.3 | ) | $ | 25.7 | $ | 3.7 | |||||
| | | | | | | | | | | | | | |
-1 | Represents only the portion allocated to continuing operations. | |||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Cash paid for interest and income taxes | |||
Interest, net of capitalized amounts | $61.60 | $64.10 | $68 |
Income taxes, net of refunds | 108.8 | 129.4 | 97.7 |
Capital expenditure accrued but not paid | $3.80 | $11.50 | $12 |
Summary Of Significant Accounting Policies | |||
Maximum length of time hedged in cash flow hedge | 36 months | ||
Length of Fiscal Period | 371 days | 364 days | 364 days |
Customer concentration risk | Net sales | Ten largest customers | |||
Summary Of Significant Accounting Policies | |||
Concentration risk percentage | 13.00% | ||
Customer concentration risk | Accounts receivable | Ten largest customers | Pressure-sensitive Materials | |||
Summary Of Significant Accounting Policies | |||
Concentration risk percentage | 15.00% | ||
Minimum | |||
Summary Of Significant Accounting Policies | |||
Software estimated useful lives | 5 years | ||
Minimum | Buildings and improvements | |||
Summary Of Significant Accounting Policies | |||
Property and equipment estimated useful lives | 10 years | ||
Minimum | Machinery and equipment | |||
Summary Of Significant Accounting Policies | |||
Property and equipment estimated useful lives | 3 years | ||
Maximum | |||
Summary Of Significant Accounting Policies | |||
Software estimated useful lives | 10 years | ||
Maximum | Customer concentration risk | Net sales | |||
Summary Of Significant Accounting Policies | |||
Concentration risk percentage | 10.00% | 10.00% | |
Maximum | Customer concentration risk | Accounts receivable | |||
Summary Of Significant Accounting Policies | |||
Concentration risk percentage | 10.00% | 10.00% | |
Maximum | Buildings and improvements | |||
Summary Of Significant Accounting Policies | |||
Property and equipment estimated useful lives | 45 years | ||
Maximum | Machinery and equipment | |||
Summary Of Significant Accounting Policies | |||
Property and equipment estimated useful lives | 15 years |
DISCONTINUED_OPERATIONS_AND_SA2
DISCONTINUED OPERATIONS AND SALE OF ASSETS (Details) (USD $) | 12 Months Ended | 0 Months Ended | |
In Millions, unless otherwise specified | Dec. 28, 2013 | Jul. 01, 2013 | Jan. 29, 2013 |
Discontinued Operations | |||
Sales price per agreement, net of cash provided | $481.20 | ||
OCP and DES businesses | CCL | |||
Discontinued Operations | |||
Cash sales price per agreement | 500 | ||
Maximum period of supply agreement | 6 years | ||
Sales price per agreement, net of cash provided | $481.20 |
DISCONTINUED_OPERATIONS_AND_SA3
DISCONTINUED OPERATIONS AND SALE OF ASSETS (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Operating results of discontinued operations and loss on sale | |||
(Loss) Income from discontinued operations, net of tax | ($2.20) | ($28.50) | $57.80 |
OCP and DES businesses | |||
Operating results of discontinued operations and loss on sale | |||
Net sales | 380.4 | 912.3 | |
(Loss) income before taxes, including divestiture-related and restructuring costs | -12.4 | 86.4 | |
Provision for income taxes | -0.1 | -28.6 | |
(Loss) income from discontinued operations, net of tax before loss on sale | -12.5 | 57.8 | |
(Loss) gain on sale before taxes | -3.3 | 49.4 | |
(Loss) Income from discontinued operations, net of tax | -2.2 | -28.5 | 57.8 |
Tax benefit (provision) on sale | 1.1 | -65.4 | |
OCP and DES businesses | Net sales. | |||
Operating results of discontinued operations and loss on sale | |||
Net sales from continuing operations to discontinued operations | $45.80 | $100 |
DISCONTINUED_OPERATIONS_AND_SA4
DISCONTINUED OPERATIONS AND SALE OF ASSETS (Details 3) (USD $) | 12 Months Ended | 1 Months Ended | |||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Sep. 30, 2014 | Apr. 30, 2013 |
Assets Held for Sale and Sale of Assets | |||||
Pre-tax gain recognized in "Other expense, net" | $0.60 | ||||
Proceeds from sales of property, plant and equipment | 4.3 | 38.7 | 4.2 | ||
Retail Branding and Information Solutions | |||||
Assets Held for Sale and Sale of Assets | |||||
Pre-tax gain recognized in "Other expense, net" | 1.9 | ||||
Proceeds from sales of property, plant and equipment | 3.3 | ||||
Pasadena, California corporate headquarters | |||||
Assets Held for Sale and Sale of Assets | |||||
Pre-tax gain recognized in "Other expense, net" | 10.9 | ||||
Proceeds from sales of property, plant and equipment | 20 | ||||
Property, plant and equipment in China | |||||
Assets Held for Sale and Sale of Assets | |||||
Proceeds from sales of property, plant and equipment | 11 | ||||
Research facility located in Pasadena, California | |||||
Assets Held for Sale and Sale of Assets | |||||
Proceeds from sales of property, plant and equipment | $5 |
GOODWILL_AND_OTHER_INTANGIBLES2
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 27, 2014 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Changes in net carrying amount of goodwill | ||||
Goodwill, Beginning Balance | $751.10 | $764.40 | ||
Divestiture | -3.5 | |||
Acquisition adjustments | 7.4 | -0.2 | ||
Translation adjustments | -36.9 | -9.6 | ||
Goodwill, Ending Balance | 721.6 | 751.1 | 764.4 | |
Impairment of goodwil | 0 | |||
Intangible Assets, Net (Excluding Goodwill). | ||||
Impairment of indefinite-lived intangible assets | 3 | 3 | 7 | |
Indefinite-lived intangible assets, carrying value | 7.9 | 10.9 | ||
Pressure-sensitive Materials | ||||
Changes in net carrying amount of goodwill | ||||
Goodwill, Beginning Balance | 334.4 | |||
Acquisition adjustments | 0.4 | |||
Translation adjustments | -28.2 | -3.9 | ||
Goodwill, Ending Balance | 306.6 | 338.3 | ||
Retail Branding and Information Solutions | ||||
Changes in net carrying amount of goodwill | ||||
Goodwill, Beginning Balance | 416.7 | |||
Acquisition adjustments | 7 | -0.2 | ||
Translation adjustments | -8.7 | -5.7 | ||
Goodwill, Ending Balance | 415 | 422.6 | ||
Accumulated impairment losses | 820 | 820 | ||
Vancive Medical Technologies | ||||
Changes in net carrying amount of goodwill | ||||
Goodwill, Ending Balance | 0 | |||
Other specialty converting businesses | ||||
Changes in net carrying amount of goodwill | ||||
Goodwill, Beginning Balance | 3.5 | |||
Divestiture | ($3.50) |
GOODWILL_AND_OTHER_INTANGIBLES3
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | $314.20 | $321.60 | |
Accumulated Amortization | 254.7 | 236.5 | |
Net Carrying Amount | 59.5 | 85.1 | |
Amortization expense on finite lived intangible assets from business acquisition | 24.4 | 28.5 | 29.9 |
Customer relationships | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 228.9 | 234.1 | |
Accumulated Amortization | 180.2 | 164.6 | |
Net Carrying Amount | 48.7 | 69.5 | |
Patents and other acquired technology | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 49 | 48.9 | |
Accumulated Amortization | 42.7 | 38.3 | |
Net Carrying Amount | 6.3 | 10.6 | |
Trade names and trademarks | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 24 | 26.2 | |
Accumulated Amortization | 20.5 | 22.5 | |
Net Carrying Amount | 3.5 | 3.7 | |
Other intangibles | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 12.3 | 12.4 | |
Accumulated Amortization | 11.3 | 11.1 | |
Net Carrying Amount | $1 | $1.30 |
GOODWILL_AND_OTHER_INTANGIBLES4
GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS (Details 3) (USD $) | Jan. 03, 2015 |
In Millions, unless otherwise specified | |
Future amortization expense for finite lived intangible assets | |
2015 | $20.80 |
2016 | 19 |
2017 | 9.9 |
2018 | 2.4 |
2019 | $1.80 |
DEBT_AND_CAPITAL_LEASES_Detail
DEBT AND CAPITAL LEASES (Details) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Short Term Borrowings From Commercial Paper | ||
Short-term debt | ||
Short term variable rate borrowings from commercial paper | $87 | $0 |
Weighted average interest rate | 0.40% | |
Uncommitted lines of credit | ||
Short-term debt | ||
Uncommitted lines of credit | 316 | |
Short term borrowings outstanding | $111.60 | $73.90 |
Weighted average interest rate | 9.40% | 11.20% |
DEBT_AND_CAPITAL_LEASES_Detail1
DEBT AND CAPITAL LEASES (Details 2) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Oct. 31, 2014 |
Revolving credit facility | ||||
Amount outstanding | $0 | $0 | ||
Revolving credit facility | ||||
Revolving credit facility | ||||
Maximum borrowing capacity | 700 | |||
Extension in maturity date | 1 year | |||
Commitment for increased borrowing | 325 | |||
Commitment fees | 1.3 | 1.4 | 1.4 | |
Previous revolving credit facility | ||||
Revolving credit facility | ||||
Maximum borrowing capacity | $675 |
DEBT_AND_CAPITAL_LEASES_Detail2
DEBT AND CAPITAL LEASES (Details 3) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Long-term debt and capital leases | ||
Capital leases obligations | $1.80 | $3 |
Less amount classified as current | -5.7 | -1.6 |
Total Long-term Debt and Capital Lease | 945.3 | 950.6 |
Series 1995 due 2015 through 2025 | ||
Long-term debt and capital leases | ||
Senior notes | 50 | 50 |
Weighted Average Interest Rate | 7.50% | |
Senior notes due 2017 at 6.6% | ||
Long-term debt and capital leases | ||
Senior notes | 249.6 | 249.6 |
Weighted Average Interest Rate | 6.60% | |
Senior notes due 2020 at 5.4% | ||
Long-term debt and capital leases | ||
Senior notes | 249.9 | 249.9 |
Weighted Average Interest Rate | 5.40% | |
Senior notes due April 2023 at 3.4% | ||
Long-term debt and capital leases | ||
Senior notes | 249.7 | 249.7 |
Weighted Average Interest Rate | 3.40% | |
Senior notes due 2033 at 6.0% | ||
Long-term debt and capital leases | ||
Senior notes | $150 | $150 |
Weighted Average Interest Rate | 6.00% |
DEBT_AND_CAPITAL_LEASES_Detail3
DEBT AND CAPITAL LEASES (Details 4) (USD $) | Jan. 03, 2015 |
In Millions, unless otherwise specified | |
Long-term debt and capital leases | |
2015 (classified as current) | $5.70 |
2016 | 0.3 |
2017 | 249.9 |
2018 | 0.2 |
2019 | 0.2 |
2020 and thereafter | $694.70 |
DEBT_AND_CAPITAL_LEASES_Detail4
DEBT AND CAPITAL LEASES (Details 5) (USD $) | 12 Months Ended | 1 Months Ended | |||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Apr. 30, 2013 | Jan. 31, 2013 | |
Debt | |||||
Fair value of debt | $1,220,000,000 | $1,060,000,000 | |||
Long Term Debt | |||||
Interest costs | 67,200,000 | 62,300,000 | 76,200,000 | ||
Interest costs capitalized | 3,900,000 | 3,300,000 | 3,300,000 | ||
Senior notes due April 2023 at 3.4% | |||||
Long Term Debt | |||||
Senior notes issued | 250,000,000 | ||||
Interest rate of senior notes | 3.35% | ||||
Proceeds, net of underwriting discounts and offering expenses | 247,500,000 | ||||
Senior notes due 2013 | |||||
Long Term Debt | |||||
Repayments of debt | $250,000,000 |
FINANCIAL_INSTRUMENTS_Details
FINANCIAL INSTRUMENTS (Details) (Cash Flow Hedging, USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Jan. 03, 2015 |
Financial Instruments | |
Cash flow net gain to be reclassified within the next 12 months | $2 |
Foreign exchange contracts | |
Financial Instruments | |
Notional amount | 1,400 |
Commodity contracts | |
Financial Instruments | |
Notional amount | $5.50 |
FINANCIAL_INSTRUMENTS_Details_
FINANCIAL INSTRUMENTS (Details 2) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Derivatives, Fair Value | ||
Asset | $10.30 | $3.20 |
Liability | 11.7 | 4.7 |
Foreign exchange contracts | Other current assets | ||
Derivatives, Fair Value | ||
Asset | 10.3 | 3.1 |
Foreign exchange contracts | Other accrued liabilities | ||
Derivatives, Fair Value | ||
Liability | 10.5 | 4.7 |
Commodity contracts | Other current assets | ||
Derivatives, Fair Value | ||
Asset | 0.1 | |
Commodity contracts | Other accrued liabilities | ||
Derivatives, Fair Value | ||
Liability | 1 | |
Commodity contracts | Long-term retirement benefits and other liabilities | ||
Derivatives, Fair Value | ||
Liability | $0.20 |
FINANCIAL_INSTRUMENTS_Details_1
FINANCIAL INSTRUMENTS (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Fair Value Hedges | |||
Gain (loss) in income | ($44.90) | ($33.60) | $17.80 |
Foreign exchange contracts | Cost of products sold | |||
Fair Value Hedges | |||
Gain (loss) in income | -1.6 | 2.3 | |
Foreign exchange contracts | Marketing, general and administrative expense | |||
Fair Value Hedges | |||
Gain (loss) in income | ($43.30) | ($35.90) | $17.80 |
FINANCIAL_INSTRUMENTS_Details_2
FINANCIAL INSTRUMENTS (Details 4) (Cash Flow Hedging, USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Derivative Instruments, Gains (Losses) | |||
Gains (losses) recognized in accumulated other comprehensive loss on derivatives | $0.10 | $1 | ($1.80) |
Foreign exchange contracts | |||
Derivative Instruments, Gains (Losses) | |||
Gains (losses) recognized in accumulated other comprehensive loss on derivatives | 1.3 | 1.1 | -0.9 |
Commodity contracts | |||
Derivative Instruments, Gains (Losses) | |||
Gains (losses) recognized in accumulated other comprehensive loss on derivatives | ($1.20) | ($0.10) | ($0.90) |
FINANCIAL_INSTRUMENTS_Details_3
FINANCIAL INSTRUMENTS (Details 5) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Derivative Instruments, Gains (Losses) | |||
Interest Expense | $63.30 | $59 | $72.90 |
Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | |||
Derivative Instruments, Gains (Losses) | |||
Gain (Loss) reclassified from accumulated other comprehensive loss | -1.2 | -0.7 | -9.7 |
Foreign exchange contracts | Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | |||
Derivative Instruments, Gains (Losses) | |||
Gain (Loss) reclassified to cost of products sold | -1.2 | 0.6 | -2.5 |
Commodity contracts | Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | |||
Derivative Instruments, Gains (Losses) | |||
Gain (Loss) reclassified to cost of products sold | 0.1 | -1.2 | -2.8 |
Interest Rate Contracts | Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | |||
Derivative Instruments, Gains (Losses) | |||
Interest Expense | ($0.10) | ($0.10) | ($4.40) |
PENSION_AND_OTHER_POSTRETIREME2
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details) (USD $) | 12 Months Ended | 3 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 28, 2013 |
Pooled funds - Alternative investments | ||||
Defined Benefit Plans | ||||
Pooled funds Valuation lag period | 1 month | |||
Notice period after lock up period | 65 days | |||
U.S.. | ||||
Defined Benefit Plans | ||||
Actuarial loss | 140.6 | ($73.40) | $93.50 | |
Number of sub-portfolios in which assets are invested | 2 | |||
U.S.. | Growth portfolio | ||||
Defined Benefit Plans | ||||
Target assets allocation (as a percent) | 65.00% | |||
U.S.. | Liability hedging portfolio | ||||
Defined Benefit Plans | ||||
Target assets allocation (as a percent) | 35.00% | |||
Int'l | ||||
Defined Benefit Plans | ||||
Actuarial loss | 51.3 | 6.1 | 16.4 | |
Int'l | Equity Securities | ||||
Defined Benefit Plans | ||||
Target assets allocation (as a percent) | 39.00% | |||
Int'l | Fixed income securities and cash | ||||
Defined Benefit Plans | ||||
Target assets allocation (as a percent) | 49.00% | |||
Int'l | Insurance contracts and Other investments | ||||
Defined Benefit Plans | ||||
Target assets allocation (as a percent) | 12.00% | |||
SHARE Plan | ||||
Defined Benefit Plans | ||||
Actuarial loss | 12 | $20 |
PENSION_AND_OTHER_POSTRETIREME3
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 2) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
In Millions, unless otherwise specified | |||
U.S.. | |||
Defined Benefit Plans | |||
Total plan assets | $778.90 | $747.40 | $648.50 |
U.S.. | Total | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 778.8 | 747.2 | |
Other assets (payables) | 0.1 | 0.2 | |
Total plan assets | 778.9 | 747.4 | |
U.S.. | Total | Cash | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 1.3 | 15.8 | |
U.S.. | Total | Liability hedging portfolio | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 371.5 | 333.1 | |
U.S.. | Total | Pooled funds - Corporate debt/agencies | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 152.4 | 332.7 | |
U.S.. | Total | Pooled funds - Fixed income | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 218.7 | ||
U.S.. | Total | Pooled funds - U.S. bonds, other fixed income | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.4 | 0.4 | |
U.S.. | Total | Growth portfolio | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 406 | 398.3 | |
U.S.. | Total | Pooled funds - Global equities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.2 | 60 | |
U.S.. | Total | Pooled funds - Global real estate investment trusts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 40.4 | 45.8 | |
U.S.. | Total | Pooled funds - International | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 87.5 | 86.6 | |
U.S.. | Total | Pooled funds - U.S. equities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 99.4 | 89.5 | |
U.S.. | Total | Pooled funds - Alternative investments | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.3 | 51.2 | |
U.S.. | Total | Pooled funds - High yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 58.2 | 65.2 | |
U.S.. | Quoted Prices in Active Markets (Level 1) | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 1.3 | 15.8 | |
U.S.. | Quoted Prices in Active Markets (Level 1) | Cash | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 1.3 | 15.8 | |
U.S.. | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 717.2 | 680.2 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Liability hedging portfolio | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 371.5 | 333.1 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - Corporate debt/agencies | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 152.4 | 332.7 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - Fixed income | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 218.7 | ||
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - U.S. bonds, other fixed income | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.4 | 0.4 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Growth portfolio | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 345.7 | 347.1 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - Global equities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.2 | 60 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - Global real estate investment trusts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 40.4 | 45.8 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - International | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 87.5 | 86.6 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - U.S. equities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 99.4 | 89.5 | |
U.S.. | Significant Other Observable Inputs (Level 2) | Pooled funds - High yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 58.2 | 65.2 | |
U.S.. | Level 3 | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.3 | 51.2 | |
U.S.. | Level 3 | Growth portfolio | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.3 | 51.2 | |
U.S.. | Level 3 | Pooled funds - Alternative investments | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 60.3 | 51.2 | |
Int'l | |||
Defined Benefit Plans | |||
Total plan assets | 618.1 | 566.6 | 515 |
Int'l | Total | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 618.1 | 566.1 | |
Other assets (payables) | 0.5 | ||
Total plan assets | 566.6 | ||
Int'l | Total | Cash | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.6 | 4.7 | |
Int'l | Total | Fixed Income Securities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 328.7 | 266.9 | |
Int'l | Total | Mutual Funds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.3 | 0.3 | |
Int'l | Total | Pooled funds - Emerging markets bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 6.7 | 6.2 | |
Int'l | Total | Pooled funds - European bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 243.5 | 193.8 | |
Int'l | Total | Pooled funds - U.K. bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 66.4 | 56.6 | |
Int'l | Total | Pooled funds - Global bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 3.4 | 3.3 | |
Int'l | Total | Pooled funds - High yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 6.5 | 6.7 | |
Int'l | Total | Pooled funds - Enhanced yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 1.9 | ||
Int'l | Total | Equity Securities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 230.7 | 218.2 | |
Int'l | Total | Pooled funds - Emerging markets | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 22.3 | 20.9 | |
Int'l | Total | Pooled funds - U.K. | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 16.2 | 17.2 | |
Int'l | Total | Pooled funds - Global | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 160.2 | 151.3 | |
Int'l | Total | Pooled funds - Real estate investment trusts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 32 | 28.8 | |
Int'l | Total | Insurance contracts and Other investments | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 58.1 | 76.3 | |
Int'l | Total | Pooled funds - Commodities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 8.4 | 9.5 | |
Int'l | Total | Pooled funds - Real estate | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 8.5 | 7.7 | |
Int'l | Total | Pooled funds - Other | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 16.6 | 31.7 | |
Int'l | Total | Insurance contracts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 24.6 | 27.4 | |
Int'l | Quoted Prices in Active Markets (Level 1) | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.9 | 5 | |
Int'l | Quoted Prices in Active Markets (Level 1) | Cash | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.6 | 4.7 | |
Int'l | Quoted Prices in Active Markets (Level 1) | Fixed Income Securities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.3 | 0.3 | |
Int'l | Quoted Prices in Active Markets (Level 1) | Mutual Funds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 0.3 | 0.3 | |
Int'l | Significant Other Observable Inputs (Level 2) | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 592.6 | 533.7 | |
Int'l | Significant Other Observable Inputs (Level 2) | Fixed Income Securities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 328.4 | 266.6 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Emerging markets bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 6.7 | 6.2 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - European bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 243.5 | 193.8 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - U.K. bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 66.4 | 56.6 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Global bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 3.4 | 3.3 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - High yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 6.5 | 6.7 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Enhanced yield bonds | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 1.9 | ||
Int'l | Significant Other Observable Inputs (Level 2) | Equity Securities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 230.7 | 218.2 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Emerging markets | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 22.3 | 20.9 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - U.K. | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 16.2 | 17.2 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Global | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 160.2 | 151.3 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Real estate investment trusts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 32 | 28.8 | |
Int'l | Significant Other Observable Inputs (Level 2) | Insurance contracts and Other investments | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 33.5 | 48.9 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Commodities | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 8.4 | 9.5 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Real estate | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 8.5 | 7.7 | |
Int'l | Significant Other Observable Inputs (Level 2) | Pooled funds - Other | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 16.6 | 31.7 | |
Int'l | Level 3 | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 24.6 | 27.4 | |
Int'l | Level 3 | Insurance contracts and Other investments | |||
Defined Benefit Plans | |||
Total plan assets at fair value | 24.6 | 27.4 | |
Int'l | Level 3 | Insurance contracts | |||
Defined Benefit Plans | |||
Total plan assets at fair value | $24.60 | $27.40 |
PENSION_AND_OTHER_POSTRETIREME4
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 3) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Int'l | ||
Reconciliation of Level 3 assets | ||
Impact of changes in foreign currency exchange rates | ($61.90) | $16.90 |
Level 3 | U.S.. | Pooled funds - Alternative investments | ||
Reconciliation of Level 3 assets | ||
Balance at the beginning of the period | 51.2 | |
Net realized and unrealized gain | 2.7 | |
Purchases | 6.4 | |
Balance at the end of the period | 60.3 | |
Level 3 | Int'l | Insurance contracts | ||
Reconciliation of Level 3 assets | ||
Balance at the beginning of the period | 27.4 | |
Net realized and unrealized gain | 0.6 | |
Purchases | 2.3 | |
Settlements | -2.9 | |
Impact of changes in foreign currency exchange rates | -2.8 | |
Balance at the end of the period | $24.60 |
PENSION_AND_OTHER_POSTRETIREME5
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 4) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Jan. 03, 2015 |
Defined Benefit Plans | |
Healthcare cost trend rate assumed for 2015 (as a percent) | 6.50% |
Healthcare cost trend rate by 2018 (as a percent) | 5.00% |
One-percentage-point change in assumed health care cost trend rates | |
Effect of one-percentage-point increase on total of service and interest cost components | $0.01 |
Effect of one-percentage-point decrease on total of service and interest cost components | -0.01 |
Effect of one-percentage-point increase on postretirement benefit obligations | 0.4 |
Effect of one-percentage-point decrease on postretirement benefit obligations | ($0.40) |
U.S. Postretirement Health Benefits | |
Defined Benefit Plans | |
Maximum age for which postretirement benefits are provided | 65 years |
Minimum age for which supplemental Medicare benefits are provided | 65 years |
PENSION_AND_OTHER_POSTRETIREME6
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 5) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
U.S.. | ||
Change in projected benefit obligations | ||
Projected benefit obligations at beginning of year | $933.70 | $963.70 |
Service cost | 0.4 | 0.4 |
Interest cost | 44.7 | 39.7 |
Amendments | 19.9 | |
Actuarial loss (gain) | 141.5 | -59.8 |
Plan transfer | 21.4 | 5.7 |
Benefits paid | -47.9 | -45.4 |
Curtailments | 9.5 | |
Projected benefit obligations at end of year | 1,093.80 | 933.7 |
Accumulated benefit obligations at end of year | 1,093.80 | 933.7 |
Int'l | ||
Change in projected benefit obligations | ||
Projected benefit obligations at beginning of year | 642.8 | 597.6 |
Service cost | 12.9 | 13 |
Interest cost | 23.8 | 23.3 |
Participant contribution | 4 | 4.1 |
Amendments | -7.2 | |
Actuarial loss (gain) | 166.1 | 8.5 |
Plan transfer | 0 | 7.1 |
Benefits paid | -22.3 | -21.2 |
Curtailments | -7.6 | -1.7 |
Settlements | -2.2 | -6 |
Foreign currency translation | -73.2 | 18.1 |
Projected benefit obligations at end of year | 737.1 | 642.8 |
Accumulated benefit obligations at end of year | 693.9 | 601.7 |
U.S. Postretirement Health Benefits | ||
Change in projected benefit obligations | ||
Projected benefit obligations at beginning of year | 9.1 | 12 |
Interest cost | 0.3 | 0.3 |
Participant contribution | 1.1 | 1.2 |
Actuarial loss (gain) | 0.3 | -0.5 |
Benefits paid | -2.8 | -3.5 |
Curtailments | -0.4 | |
Projected benefit obligations at end of year | $8 | $9.10 |
PENSION_AND_OTHER_POSTRETIREME7
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 6) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
U.S.. | ||
Change in plan assets | ||
Plan assets at the beginning of the period | $747.40 | $648.50 |
Actual return on plan assets | 52.9 | 61.8 |
Plan transfer | 21.4 | 5.7 |
Employer contributions | 5.1 | 76.8 |
Benefits paid | -47.9 | -45.4 |
Plan assets at the end of the period | 778.9 | 747.4 |
Int'l | ||
Change in plan assets | ||
Plan assets at the beginning of the period | 566.6 | 515 |
Actual return on plan assets | 117.9 | 26.6 |
Plan transfer | 2.3 | |
Employer contributions | 16 | 28.9 |
Participant contributions | 4 | 4.1 |
Benefits paid | -22.3 | -21.2 |
Settlements | -2.2 | -6 |
Foreign currency translation | -61.9 | 16.9 |
Plan assets at the end of the period | 618.1 | 566.6 |
U.S. Postretirement Health Benefits | ||
Change in plan assets | ||
Employer contributions | 1.7 | 2.3 |
Participant contributions | 1.1 | 1.2 |
Benefits paid | ($2.80) | ($3.50) |
PENSION_AND_OTHER_POSTRETIREME8
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 7) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
U.S. plans | |||
Pension plans with projected benefit obligations in excess of plan assets | |||
Projected benefit obligation in excess of plan assets | $1,450,000,000 | $1,250,000,000 | |
Fair value of plan assets in excess of plan assets | 997,300,000 | 953,700,000 | |
Pension plans with accumulated benefit obligations in excess of plan assets | |||
Accumulated benefit obligations | 1,430,000,000 | 1,220,000,000 | |
Fair value of plan assets | 997,300,000 | 938,600,000 | |
U.S.. | |||
Funded status of the plans | |||
Other accrued liabilities | -4,100,000 | -3,600,000 | |
Long-term retirement benefits and other liabilities | -310,800,000 | -182,700,000 | |
Plan assets less than benefit obligations | -314,900,000 | -186,300,000 | |
Weighted-average assumptions used to determine year-end benefit obligations | |||
Discount rate (as a percent) | 4.00% | 4.85% | 4.00% |
Int'l | |||
Funded status of the plans | |||
Other assets | 20,000,000 | 35,400,000 | |
Other accrued liabilities | -2,500,000 | -2,700,000 | |
Long-term retirement benefits and other liabilities | -136,500,000 | -108,900,000 | |
Plan assets less than benefit obligations | -119,000,000 | -76,200,000 | |
Weighted-average assumptions used to determine year-end benefit obligations | |||
Discount rate (as a percent) | 2.54% | 3.88% | 3.94% |
Compensation Rate Increase | 2.22% | 2.24% | 2.24% |
U.S. Postretirement Health Benefits | |||
Funded status of the plans | |||
Other accrued liabilities | -1,600,000 | -2,200,000 | |
Long-term retirement benefits and other liabilities | -6,400,000 | -6,900,000 | |
Plan assets less than benefit obligations | ($8,000,000) | ($9,100,000) | |
Weighted-average assumptions used to determine year-end benefit obligations | |||
Discount rate (as a percent) | 3.50% | 3.45% | 2.85% |
PENSION_AND_OTHER_POSTRETIREME9
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 8) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
U.S.. | ||
Pretax amounts, including that of discontinued operations, recognized in accumulated other comprehensive loss | ||
Net actuarial loss | $590.50 | $466.90 |
Prior service cost (credit) | 19.9 | 21 |
Net amount recognized in accumulated other comprehensive loss | 610.4 | 487.9 |
Int'l | ||
Pretax amounts, including that of discontinued operations, recognized in accumulated other comprehensive loss | ||
Net actuarial loss | 174.8 | 129.5 |
Prior service cost (credit) | -5.3 | 2.5 |
Net transition obligation | 0.4 | 0.5 |
Net amount recognized in accumulated other comprehensive loss | 169.9 | 132.5 |
U.S. Postretirement Health Benefits | ||
Pretax amounts, including that of discontinued operations, recognized in accumulated other comprehensive loss | ||
Net actuarial loss | 24.1 | 26.6 |
Prior service cost (credit) | -22.9 | -26.2 |
Net amount recognized in accumulated other comprehensive loss | $1.20 | $0.40 |
Recovered_Sheet1
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 9) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Out of period adjustment | |||
Defined Benefit Plans | |||
Net actuarial loss (gain) | ($15) | ||
U.S.. | |||
Defined Benefit Plans | |||
Net actuarial loss (gain) | 140.6 | -73.4 | 93.5 |
Prior service cost (credit) | 19.9 | ||
Amortization of unrecognized net actuarial loss | -16.8 | -18.6 | -14.9 |
Amortization of unrecognized prior service (cost) credit | -1.2 | -0.3 | -0.4 |
Net amount recognized in other comprehensive loss (income) | 122.6 | -72.4 | 78.2 |
Int'l | |||
Defined Benefit Plans | |||
Net actuarial loss (gain) | 51.3 | 6.1 | 16.4 |
Prior service cost (credit) | -7.3 | ||
Amortization of unrecognized net actuarial loss | -5.6 | -8 | -3.3 |
Amortization of unrecognized prior service (cost) credit | -1 | -0.4 | -0.5 |
Net transition asset | 0.1 | 0.5 | |
Net amount recognized in other comprehensive loss (income) | 37.4 | -2.2 | 13.1 |
U.S. Postretirement Health Benefits | |||
Defined Benefit Plans | |||
Net actuarial loss (gain) | 0.3 | -0.9 | 1.7 |
Amortization of unrecognized net actuarial loss | -2.8 | -2.5 | -2.7 |
Amortization of unrecognized prior service (cost) credit | 3.3 | 17.2 | 4.8 |
Net amount recognized in other comprehensive loss (income) | $0.80 | $13.80 | $3.80 |
Recovered_Sheet2
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 10) (USD $) | 3 Months Ended | 12 Months Ended | ||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Jun. 28, 2014 | Sep. 28, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Components of net periodic benefit cost: | ||||||
Recognized (loss) gain on curtailment | $1 | $0.60 | ($1.60) | $1.60 | ($1.60) | |
Net gain amount on curtailments and settlement | -1 | -0.6 | 1.6 | -1.6 | 1.6 | |
OCP and DES businesses | (Loss) from discontinued operations, net of tax | ||||||
Components of net periodic benefit cost: | ||||||
Recognized (loss) gain on curtailment | -2.7 | |||||
Net gain amount on curtailments and settlement | 2.7 | |||||
U.S.. | ||||||
Components of net periodic benefit cost: | ||||||
Service cost | 0.4 | 0.4 | ||||
Interest cost | 44.7 | 39.7 | ||||
U.S.. | Continuing operations | ||||||
Components of net periodic benefit cost: | ||||||
Service cost | 0.4 | 0.4 | 0.3 | |||
Interest cost | 44.7 | 39.7 | 40.3 | |||
Expected return on plan assets | -52 | -48.1 | -45.9 | |||
Recognized net actuarial loss | 16.2 | 17.7 | 14.3 | |||
Amortization of prior service cost (credit) | 1.2 | 0.3 | 0.4 | |||
Recognized loss on settlement | 0.6 | 0.6 | ||||
Net periodic benefit cost (credit) | 11.1 | 10 | 10 | |||
Int'l | ||||||
Components of net periodic benefit cost: | ||||||
Service cost | 12.9 | 13 | ||||
Interest cost | 23.8 | 23.3 | ||||
Amortization of transition asset | -0.1 | -0.5 | ||||
Int'l | Continuing operations | ||||||
Components of net periodic benefit cost: | ||||||
Service cost | 12.9 | 13 | 9.1 | |||
Interest cost | 23.8 | 23.3 | 24.5 | |||
Expected return on plan assets | -26 | -22.6 | -22.1 | |||
Recognized net actuarial loss | 5.2 | 6.3 | 3.1 | |||
Amortization of prior service cost (credit) | 0.4 | 0.5 | 0.4 | |||
Amortization of transition asset | -0.1 | -0.5 | ||||
Recognized (loss) gain on curtailment | 0.6 | -1.5 | ||||
Recognized loss on settlement | 0.4 | 0.5 | ||||
Net periodic benefit cost (credit) | 17.3 | 19.4 | 14.5 | |||
Net gain amount on curtailments and settlement | -0.6 | 1.5 | ||||
U.S. Postretirement Health Benefits | ||||||
Components of net periodic benefit cost: | ||||||
Interest cost | 0.3 | 0.3 | ||||
U.S. Postretirement Health Benefits | OCP and DES businesses | ||||||
Components of net periodic benefit cost: | ||||||
Recognized (loss) gain on curtailment | -13.1 | |||||
Net gain amount on curtailments and settlement | 13.1 | |||||
U.S. Postretirement Health Benefits | Continuing operations | ||||||
Components of net periodic benefit cost: | ||||||
Interest cost | 0.3 | 0.3 | 0.5 | |||
Recognized net actuarial loss | 2.8 | 2.5 | 2.7 | |||
Amortization of prior service cost (credit) | -3.3 | -4.1 | -4.8 | |||
Net periodic benefit cost (credit) | -0.2 | -1.3 | -1.6 | |||
U.S. plans | OCP and DES businesses | ||||||
Components of net periodic benefit cost: | ||||||
Recognized (loss) gain on curtailment | 10.4 | |||||
Net gain amount on curtailments and settlement | ($10.40) |
Recovered_Sheet3
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 11) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Defined Benefit Plans | |||
Recognized defined contribution plan cost | $19.40 | $21 | $19.80 |
U.S.. | |||
Defined Benefit Plans | |||
Employer contributions | 5.1 | 76.8 | |
Weighted-average assumptions used for determining net periodic cost | |||
Discount rate | 4.85% | 4.00% | 4.75% |
Expected return on assets | 7.75% | 8.00% | 8.00% |
Company's contribution to the defined benefit plan in the next fiscal year | 4 | ||
Int'l | |||
Defined Benefit Plans | |||
Employer contributions | 16 | 28.9 | |
Weighted-average assumptions used for determining net periodic cost | |||
Discount rate | 3.88% | 3.94% | 4.80% |
Expected return on assets | 4.82% | 4.78% | 4.95% |
Compensation rate increase | 2.24% | 2.24% | 2.79% |
Company's contribution to the defined benefit plan in the next fiscal year | 15 | ||
U.S. Postretirement Health Benefits | |||
Defined Benefit Plans | |||
Employer contributions | 1.7 | 2.3 | |
Weighted-average assumptions used for determining net periodic cost | |||
Discount rate | 3.45% | 2.85% | 3.75% |
Company's contribution to the defined benefit plan in the next fiscal year | $2 |
Recovered_Sheet4
PENSION AND OTHER POSTRETIREMENT BENEFITS (Detail 12) (USD $) | Jan. 03, 2015 |
In Millions, unless otherwise specified | |
U.S.. | |
Future Benefit Payments | |
2015 | $49.40 |
2016 | 50.1 |
2017 | 52.2 |
2018 | 68.4 |
2019 | 58.2 |
2020 - 2023 | 294.5 |
Int'l | |
Future Benefit Payments | |
2015 | 18.4 |
2016 | 19.3 |
2017 | 19.8 |
2018 | 20.1 |
2019 | 21.1 |
2020 - 2023 | 119.2 |
U.S. Postretirement Health Benefits | |
Future Benefit Payments | |
2015 | 1.6 |
2016 | 1.2 |
2017 | 0.9 |
2018 | 0.6 |
2019 | 0.5 |
2020 - 2023 | $1.60 |
Recovered_Sheet5
PENSION AND OTHER POSTRETIREMENT BENEFITS (Details 13) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Defined contribution and other retirement plans | |||
Deferred compensation plan accrued | $125.20 | $128.60 | |
Letters of credit securing deferred compensation plan obligations | 2.5 | 3 | |
Deferred compensation (expense) gain | 6.8 | 5.9 | 7.1 |
Minimum age of participant for termination of employment to determine forfeiture of interest on contribution | 55 years | ||
DSUs outstanding under directors deferred equity compensation plan for non-employee directors | 0.1 | 0.1 | |
Value of DSUs outstanding under directors deferred equity compensation plan for non-employee directors | 6.1 | 5.5 | |
U.S.. | |||
Defined contribution and other retirement plans | |||
Net actuarial loss | 20.3 | ||
Prior service cost (credit) | 1.1 | ||
Net loss (gain) to be recognized | 21.4 | ||
Int'l | |||
Defined contribution and other retirement plans | |||
Net actuarial loss | 10.4 | ||
Prior service cost (credit) | -0.3 | ||
Net transition obligation | 0.1 | ||
Net loss (gain) to be recognized | 10.2 | ||
U.S. Postretirement Health Benefits | |||
Defined contribution and other retirement plans | |||
Net actuarial loss | 2.6 | ||
Prior service cost (credit) | -3.3 | ||
Net loss (gain) to be recognized | -0.7 | ||
Other assets | |||
Defined contribution and other retirement plans | |||
Cash surrender value included in other assets | $210.90 | $204.60 |
COMMITMENTS_Details
COMMITMENTS (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Minimum annual rental commitments on operating leases | |||
2015 | $50.90 | ||
2016 | 37.4 | ||
2017 | 22.3 | ||
2018 | 13.6 | ||
2019 | 10.3 | ||
2020 and thereafter | 39.3 | ||
Total minimum lease payments | 173.8 | ||
Rent expense for operating leases from continuing operations | $67 | $70 | $75 |
COMMITMENTS_Details_2
COMMITMENTS (Details 2) (Mentor lease facility, USD $) | 0 Months Ended | |
In Millions, unless otherwise specified | Sep. 09, 2005 | Jan. 03, 2015 |
Guarantor Obligations | ||
Term of lease financing for commercial facility | 10 years | |
Residual value guarantee | $31.50 | |
Refinancing of lessor debt | 11.5 | |
Other current liabilities | ||
Guarantor Obligations | ||
Aggregate amount of lease commitment | $16 |
CONTINGENCIES_Details
CONTINGENCIES (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
item | ||
Environmental Liabilities Associated with Remediation | ||
Environmental site contingency number of sites | 14 | |
Balance at beginning of year | $29.60 | $32.50 |
Charges (reversals), net | 1.7 | 4.6 |
Payments | -5.1 | -7.5 |
Balance at end of year | 26.2 | 29.6 |
Short term environmental liabilities | 10 | |
Letters of credit | ||
Guarantor Obligations | ||
Unused borrowing capacity with various financial institutions | 53 | |
Guarantee receivable financing | ||
Guarantor Obligations | ||
Guarantee obligations | $17 |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 28, 2013 | Jan. 03, 2015 |
Assets | ||
Derivative assets | $3.20 | $10.30 |
Liabilities | ||
Derivative liabilities | 4.7 | 11.7 |
Recurring | ||
Assets | ||
Trading securities | 17.7 | 17.9 |
Short-term investments | 114.5 | |
Derivative assets | 3.2 | 10.3 |
Liabilities | ||
Derivative liabilities | 4.7 | 11.7 |
Recurring | Cash and Cash Equivalents | ||
Assets | ||
Trading securities | 0.3 | 0.8 |
Recurring | Other current assets | ||
Assets | ||
Trading securities | 17.4 | 17.1 |
Quoted Prices in Active Markets (Level 1) | Recurring | ||
Assets | ||
Trading securities | 7.6 | 7.6 |
Derivative assets | 0.1 | |
Liabilities | ||
Derivative liabilities | 1.2 | |
Significant Other Observable Inputs (Level 2) | Recurring | ||
Assets | ||
Trading securities | 10.1 | 10.3 |
Short-term investments | 114.5 | |
Derivative assets | 3.1 | 10.3 |
Liabilities | ||
Derivative liabilities | 4.7 | 10.5 |
Level 3 | Non-recurring | ||
Liabilities | ||
Carrying value of long-lived assets | 8.3 | |
Fair value of long-lived assets | 4.8 | |
Level 3 | Non-recurring | Other expense, net | ||
Liabilities | ||
Impairment charge of long-lived assets | $3.50 |
NET_INCOME_PER_SHARE_Details
NET INCOME PER SHARE (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Net income per common share amounts | |||||||||||
Income from continuing operations | $70.10 | $65 | $44.40 | $71.60 | $44.70 | $62 | $70.80 | $66.80 | $251.10 | $244.30 | $157.60 |
Loss (income) from discontinued operations, net of tax | -2.2 | -28.5 | 57.8 | ||||||||
Net income | $70.90 | $64.30 | $42.50 | $71.20 | $42.70 | $46.50 | $68.80 | $57.80 | $248.90 | $215.80 | $215.40 |
Weighted-average number of common shares outstanding | 93.8 | 98.4 | 102.6 | ||||||||
Dilutive shares (additional common shares issuable under stock-based awards) | 1.9 | 1.7 | 0.9 | ||||||||
Weighted-average number of common shares outstanding, assuming dilution | 95.7 | 100.1 | 103.5 | ||||||||
Net income (loss) per common share: | |||||||||||
Continuing operations (in dollars per share) | $0.77 | $0.70 | $0.47 | $0.74 | $0.46 | $0.63 | $0.71 | $0.67 | $2.68 | $2.48 | $1.54 |
Discontinued operations (in dollars per share) | $0.01 | ($0.01) | ($0.02) | ($0.02) | ($0.16) | ($0.02) | ($0.09) | ($0.03) | ($0.29) | $0.56 | |
Net income per common share (in dollars per share) | $0.78 | $0.69 | $0.45 | $0.74 | $0.44 | $0.47 | $0.69 | $0.58 | $2.65 | $2.19 | $2.10 |
Net income (loss) per common share, assuming dilution: | |||||||||||
Continuing operations (in dollars per share) | $0.75 | $0.68 | $0.46 | $0.73 | $0.45 | $0.62 | $0.70 | $0.66 | $2.62 | $2.44 | $1.52 |
Discontinued operations (in dollars per share) | $0.01 | ($0.02) | ($0.02) | ($0.15) | ($0.02) | ($0.09) | ($0.02) | ($0.28) | $0.56 | ||
Net income per common share, assuming dilution (in dollars per share) | $0.76 | $0.68 | $0.44 | $0.73 | $0.43 | $0.47 | $0.68 | $0.57 | $2.60 | $2.16 | $2.08 |
Stock-based compensation awards excluded from the computation of net income per common share, assuming dilution | 3 | 7 | 12 |
SUPPLEMENTAL_EQUITY_AND_COMPRE2
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION (Details) (USD $) | 12 Months Ended | ||||
In Millions, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 04, 2014 | Jul. 25, 2013 |
SHAREHOLDERS' EQUITY | |||||
Preferred stock, shares authorized | 5,000,000 | ||||
Preferred stock, par value (in dollars per share) | $1 | ||||
Preferred stock, outstanding shares | 0 | ||||
Repurchase of common stock | 7,400,000 | ||||
Repurchase of common stock, value | $355.50 | $283.50 | $235.20 | ||
Share repurchase authorized amount | 500 | 400 | |||
Share repurchase remained authorized amount | $600 |
SUPPLEMENTAL_EQUITY_AND_COMPRE3
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Changes in Accumulated other comprehensive loss (net of tax) | |||
Balance at beginning of the period | ($281.10) | ($278) | |
Other comprehensive loss before reclassifications, net of tax | -284 | -23.1 | |
Reclassifications to net income, net of tax | 17.8 | 20 | |
Net current-period other comprehensive income (loss), net of tax | -266.2 | -3.1 | -14.8 |
Balance at end of the period | -547.3 | -281.1 | -278 |
Foreign Currency Translation | |||
Changes in Accumulated other comprehensive loss (net of tax) | |||
Balance at beginning of the period | 138 | 180.5 | |
Other comprehensive loss before reclassifications, net of tax | -154.7 | -53.3 | |
Reclassifications to net income, net of tax | 10.8 | ||
Net current-period other comprehensive income (loss), net of tax | -154.7 | -42.5 | |
Balance at end of the period | -16.7 | 138 | |
Pension and Other Postretirement Benefits | |||
Changes in Accumulated other comprehensive loss (net of tax) | |||
Balance at beginning of the period | -418.1 | -456.5 | |
Other comprehensive loss before reclassifications, net of tax | -129.4 | 29.4 | |
Reclassifications to net income, net of tax | 16.9 | 9 | |
Net current-period other comprehensive income (loss), net of tax | -112.5 | 38.4 | |
Balance at end of the period | -530.6 | -418.1 | |
Cash Flow Hedges | |||
Changes in Accumulated other comprehensive loss (net of tax) | |||
Balance at beginning of the period | -1 | -2 | |
Other comprehensive loss before reclassifications, net of tax | 0.1 | 0.8 | |
Reclassifications to net income, net of tax | 0.9 | 0.2 | |
Net current-period other comprehensive income (loss), net of tax | 1 | 1 | |
Balance at end of the period | $0 | ($1) |
SUPPLEMENTAL_EQUITY_AND_COMPRE4
SUPPLEMENTAL EQUITY AND COMPREHENSIVE INCOME INFORMATION (Details 3) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Cost of products sold | ($4,679.10) | ($4,502.30) | ($4,335.30) | ||||||||
Interest Expense | 63.3 | 59 | 72.9 | ||||||||
Income from continuing operations before taxes | 364.4 | 363.1 | 237.6 | ||||||||
Provision for income taxes | 113.3 | 118.8 | 80 | ||||||||
Income from continuing operations | 70.1 | 65 | 44.4 | 71.6 | 44.7 | 62 | 70.8 | 66.8 | 251.1 | 244.3 | 157.6 |
Reclassifications to net income, net of tax | 17.8 | 20 | |||||||||
Income tax expense (benefit) allocated to other comprehensive (loss) income: | |||||||||||
Foreign currency translation | 0.9 | ||||||||||
Pension and other postretirement benefits: | |||||||||||
Net actuarial (loss) gain | -56.6 | 26.4 | -38.3 | ||||||||
Prior service credit (cost) | 1.1 | -7.5 | |||||||||
Reclassifications to net income: | |||||||||||
Amortization of net actuarial loss | 7.5 | 9.4 | 6.9 | ||||||||
Amortization of prior service credit | -0.7 | -1.3 | -1.5 | ||||||||
Amortization of transition asset | 0 | -0.1 | |||||||||
Net curtailment of pension and post-retirement benefit obligations | 0.1 | -4.8 | |||||||||
Settlement of pension obligations | 0.3 | 0.6 | 0.2 | ||||||||
Net gain amount on curtailments and settlement | -1 | -0.6 | 1.6 | -1.6 | 1.6 | ||||||
Derivative financial instruments: | |||||||||||
Losses (gains) recognized on cash flow hedges | 0.1 | 0.2 | -0.7 | ||||||||
Reclassifications to net income | 0.3 | 0.1 | 3.7 | ||||||||
Income tax (benefit) expense related to items of other comprehensive (loss) income | -47.9 | 23.1 | -28.9 | ||||||||
(Loss) from discontinued operations, net of tax | OCP and DES businesses | |||||||||||
Reclassifications to net income: | |||||||||||
Net gain amount on curtailments and settlement | 2.7 | ||||||||||
Amounts Reclassified from Accumulated other comprehensive loss. | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Income from continuing operations | -17.8 | -16.2 | |||||||||
Amounts Reclassified from Accumulated other comprehensive loss. | (Loss) from discontinued operations, net of tax | U.S.. | OCP and DES businesses | |||||||||||
Reclassifications to net income: | |||||||||||
Net gain amount on curtailments and settlement | 6.4 | ||||||||||
Amounts Reclassified from Accumulated other comprehensive loss. | Pension and Other Postretirement Benefits | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Amortization of defined benefit pension | -24.1 | -23.5 | |||||||||
Provision for income taxes | 7.2 | 7.8 | |||||||||
Income from continuing operations | -16.9 | -15.7 | |||||||||
Cash Flow Hedges | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Reclassifications to net income, net of tax | 0.9 | 0.2 | |||||||||
Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Income from continuing operations before taxes | -1.2 | -0.7 | |||||||||
Provision for income taxes | 0.3 | 0.2 | |||||||||
Income from continuing operations | -0.9 | -0.5 | |||||||||
Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | Foreign exchange contracts | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Cost of products sold | -1.2 | 0.6 | |||||||||
Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | Commodity contracts | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Cost of products sold | 0.1 | -1.2 | |||||||||
Cash Flow Hedges | Amounts Reclassified from Accumulated other comprehensive loss. | Interest Rate Contracts | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Interest Expense | -0.1 | -0.1 | -4.4 | ||||||||
Pension and Other Postretirement Benefits | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Reclassifications to net income, net of tax | 16.9 | 9 | |||||||||
Foreign Currency Translation | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Reclassifications to net income, net of tax | 10.8 | ||||||||||
Foreign Currency Translation | Amounts Reclassified from Accumulated other comprehensive loss. | (Loss) from discontinued operations, net of tax | OCP and DES businesses | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | |||||||||||
Reclassifications to net income, net of tax | $10.80 |
LONGTERM_INCENTIVE_COMPENSATIO2
LONG-TERM INCENTIVE COMPENSATION (Details) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Stock-Based Compensation | |||
Stock-based compensation cost capitalized | $0 | $0 | $0 |
Weighted-average fair value per share of options granted | $6.97 | $7.08 | |
Total intrinsic value of stock options exercised | 15.4 | 26.1 | 3.8 |
Tax deductions associated with option exercises | 5.3 | 8.5 | 1.3 |
Proceeds from exercises of stock options, net | 34.2 | 44.8 | 10.2 |
Weighted average assumptions | |||
Risk-free interest rate | 1.04% | 1.82% | |
Expected stock price volatility | 27.17% | 32.81% | |
Expected dividend yield | 3.40% | 3.30% | |
Expected option term | 6 years 2 months 12 days | 6 years | |
Continuing operations | Marketing, general and administrative expense | |||
Stock-Based Compensation | |||
Stock-based compensation expense | 28.3 | 32.3 | 35.8 |
Tax benefit related to Stock-based compensation | 10.5 | 10.8 | 12.5 |
Long-term incentive units | Continuing operations | Marketing, general and administrative expense | |||
Stock-Based Compensation | |||
Employee Service Cash Award Tax Benefit from Compensation Expense | 5.7 | 3.2 | 0.5 |
LTI units expense | 17.8 | 10.3 | 1.9 |
Stock Options | |||
Stock-Based Compensation | |||
Option expiration period | 10 years | ||
Stock Options | Ratable vesting | |||
Stock-Based Compensation | |||
Vesting period | 4 years | ||
Stock Options | Minimum | Ratable vesting | Non-employee Directors | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Stock Options | Maximum | |||
Stock-Based Compensation | |||
Purchase price of common stock as a percentage of its fair market value granted to non-employee directors and employees | 100.00% | ||
Market-leveraged stock units (MSUs) | Ratable vesting | |||
Stock-Based Compensation | |||
Vesting period | 4 years | ||
Market-leveraged stock units (MSUs) | Minimum | Ratable vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 0.00% | ||
Market-leveraged stock units (MSUs) | Maximum | Ratable vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 200.00% | ||
Market-leveraged long-term incentive units | Ratable vesting | |||
Stock-Based Compensation | |||
Vesting period | 4 years | ||
Performance long-term incentive units | Cliff vesting | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Performance long-term incentive units | Minimum | Cliff vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 0.00% | ||
Performance long-term incentive units | Maximum | Cliff vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 2.00% | ||
Performance Units (PUs) | Cliff vesting | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Performance Units (PUs) | Minimum | Cliff vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 0.00% | ||
Performance Units (PUs) | Maximum | Cliff vesting | |||
Stock-Based Compensation | |||
Shares issued (as a percent) | 200.00% | ||
Restricted Stock Units (RSUs) | Minimum | Non-employee Directors | |||
Stock-Based Compensation | |||
Vesting period | 3 years | ||
Restricted Stock Units (RSUs) | Maximum | Employees | |||
Stock-Based Compensation | |||
Vesting period | 4 years | ||
Unvested Stock Options, Performance Units, Restricted Stock Units and Market-leveraged stock units | Continuing operations | |||
Stock-Based Compensation | |||
Unrecognized compensation cost related to share based compensation cost | $29 | ||
Unrecognized compensation cost weighted average recognition period | 2 years |
LONGTERM_INCENTIVE_COMPENSATIO3
LONG-TERM INCENTIVE COMPENSATION (Details 2) (USD $) | 12 Months Ended | |
In Millions, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Number of options | ||
Outstanding beginning balance, options | 7,891,200 | |
Exercised, options | -1,009,200 | |
Forfeited or expired, options | -1,703,400 | |
Outstanding ending balance, options | 5,178,600 | 7,891,200 |
Options vested and expected to vest, options | 5,134,500 | |
Options exercisable | 4,444,200 | |
Weighted-average exercise price | ||
Outstanding, Weighted-average exercise price, beginning balance | $45.85 | |
Exercised, weighted-average exercise price | $34.14 | |
Forfeited or expired, Weighted-average exercise price | $58.17 | |
Outstanding, Weighted-average exercise price, ending balance | $44.08 | $45.85 |
Options vested and expected to vest, Weighted-average exercise price | $44.19 | |
Options exercisable ,Weighted-average exercise price | $45.89 | |
Weighted-average remaining contractual life | ||
Outstanding ,Weighted-average remaining contractual life beginning balance | 3 years 11 months 12 days | 4 years 3 months 7 days |
Outstanding ,Weighted-average remaining contractual life ending balance | 3 years 11 months 12 days | 4 years 3 months 7 days |
Options vested or expected to vest, Weighted-average remaining contractual life | 3 years 11 months 12 days | |
Options exercisable, Weighted-average remaining contractual life | 3 years 6 months 4 days | |
Aggregate intrinsic value | ||
Outstanding, Aggregate intrinsic value beginning balance | $69 | |
Outstanding, Aggregate intrinsic value ending balance | 54.6 | 69 |
Options vested and expected to vest, Aggregate Intrinsic Value | 53.7 | |
Options exercisable, Aggregate Intrinsic Value | $40.90 |
LONGTERM_INCENTIVE_COMPENSATIO4
LONG-TERM INCENTIVE COMPENSATION (Details 3) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Performance Units (PUs) | |||
Number of awards | |||
Number of units unvested, beginning balance | 795,200 | ||
Number of units, granted at target | 183,600 | ||
Number of units, forfeited/cancelled | -288,900 | ||
Number of units unvested, ending balance | 689,900 | 795,200 | |
Fair value | $9.80 | $0.30 | |
Weighted-average grant-date fair value | |||
Weighted-average grant-date fair value unvested, beginning balance | $41.32 | ||
Weighted-average grant-date fair value, granted at target | $47.85 | ||
Weighted-average grant-date fair value, vested | $47.85 | $52.93 | $34.43 |
Weighted-average grant-date fair value, forfeited/Cancelled | $41.59 | ||
Weighted-average grant-date fair value unvested, ending balance | $40.16 | $41.32 | |
Market-leveraged stock units (MSUs) | |||
Number of awards | |||
Number of units unvested, beginning balance | 330,100 | ||
Number of units, granted at target | 338,100 | ||
Number of units, Granted for above-target performance | 33,300 | ||
Number of units, vested | -109,600 | ||
Number of units, forfeited/cancelled | -40,100 | ||
Number of units unvested, ending balance | 551,800 | 330,100 | |
Weighted-average grant-date fair value | |||
Weighted-average grant-date fair value unvested, beginning balance | $51.40 | ||
Weighted-average grant-date fair value, granted at target | $52.76 | $51.40 | |
Weighted-average grant-date fair value, Adjustment for above-target performance | $51.40 | ||
Weighted-average grant-date fair value, vested | $51.40 | ||
Weighted-average grant-date fair value, forfeited/Cancelled | $53.11 | ||
Weighted-average grant-date fair value unvested, ending balance | $52.18 | $51.40 | |
Restricted Stock Units (RSUs) | |||
Number of awards | |||
Number of units unvested, beginning balance | 681,000 | ||
Number of units, granted at target | 48,900 | ||
Number of units, vested | -301,100 | ||
Number of units, forfeited/cancelled | -40,800 | ||
Number of units unvested, ending balance | 388,000 | 681,000 | |
Fair value | $9.50 | $15.90 | $12.50 |
Weighted-average grant-date fair value | |||
Weighted-average grant-date fair value unvested, beginning balance | $31.06 | ||
Weighted-average grant-date fair value, granted at target | $45.91 | $38.72 | $27.88 |
Weighted-average grant-date fair value, vested | $31.41 | ||
Weighted-average grant-date fair value, forfeited/Cancelled | $31.53 | ||
Weighted-average grant-date fair value unvested, ending balance | $32.70 | $31.06 |
COST_REDUCTION_ACTIONS_Details
COST REDUCTION ACTIONS (Details) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 31, 2011 |
item | item | item | item | |
2014 Actions | ||||
Restructuring Cost and Reserve | ||||
Charges (Reversals), net | $66.50 | |||
Number of positions reduced as a result of Cost Reduction Actions | 1,420 | |||
Number of positions remaining | 100 | |||
2012 Program | ||||
Restructuring Cost and Reserve | ||||
Charges (Reversals), net | 40.3 | 56.4 | ||
Number of positions reduced as a result of Cost Reduction Actions | 1,400 | 1,060 | ||
Number of positions remaining | 0 | |||
2011 Actions | ||||
Restructuring Cost and Reserve | ||||
Charges (Reversals), net | $45 | |||
Number of positions reduced as a result of Cost Reduction Actions | 910 | |||
Number of positions remaining | 0 |
COST_REDUCTION_ACTIONS_Details1
COST REDUCTION ACTIONS (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | Dec. 31, 2011 |
Severance and related costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | $6.70 | $5.10 | $35.90 | $7 | $6.30 | $8.70 | $5.40 | $6.80 | $54.70 | $27.20 | $49.30 | |
2014 Actions | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 66.5 | |||||||||||
2014 Actions | Severance and related costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 55.1 | |||||||||||
Cash payments | -35.6 | |||||||||||
Foreign Currency translation | -2.7 | |||||||||||
Ending Balance | 16.8 | 16.8 | ||||||||||
2014 Actions | Asset impairment charges | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 10.8 | |||||||||||
Non-cash Impairment | -10.8 | |||||||||||
2014 Actions | Lease cancellation costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 0.6 | |||||||||||
Cash payments | -0.5 | |||||||||||
Ending Balance | 0.1 | 0.1 | ||||||||||
2012 Program | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 40.3 | 56.4 | ||||||||||
2012 Program | Severance and related costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Beginning Balance | 6.6 | 20.7 | 6.6 | 20.7 | ||||||||
Charges (Reversals), net | -0.4 | 27.2 | ||||||||||
Cash payments | -5.2 | -41 | ||||||||||
Foreign Currency translation | -0.2 | -0.3 | ||||||||||
Ending Balance | 0.8 | 6.6 | 0.8 | 6.6 | ||||||||
2012 Program | Asset impairment charges | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 9.7 | |||||||||||
Non-cash Impairment | -9.7 | |||||||||||
2012 Program | Lease and other contract cancellation costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Beginning Balance | 0.2 | 0.1 | 0.2 | 0.1 | ||||||||
Charges (Reversals), net | 3.4 | |||||||||||
Cash payments | -0.2 | -3.3 | ||||||||||
Ending Balance | 0.2 | 0.2 | ||||||||||
2011 Actions | ||||||||||||
Cost Reduction Actions | ||||||||||||
Charges (Reversals), net | 45 | |||||||||||
2011 Actions | Severance and related costs | ||||||||||||
Cost Reduction Actions | ||||||||||||
Beginning Balance | 0.1 | 0.1 | ||||||||||
Cash payments | -0.1 | |||||||||||
Total including discontinued operations | ||||||||||||
Cost Reduction Actions | ||||||||||||
Beginning Balance | 6.8 | 20.9 | 6.8 | 20.9 | ||||||||
Charges (Reversals), net | 66.1 | 40.3 | ||||||||||
Cash payments | -41.5 | -44.4 | ||||||||||
Non-cash Impairment | -10.8 | -9.7 | ||||||||||
Foreign Currency translation | -2.9 | -0.3 | ||||||||||
Ending Balance | $17.70 | $6.80 | $17.70 | $6.80 |
COST_REDUCTION_ACTIONS_Details2
COST REDUCTION ACTIONS (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Continuing operations | Other expense, net | |||
Restructuring Cost and Reserve | |||
Restructuring costs | $66.10 | $40.30 | $55.80 |
Discontinued operations | Other expense, net | |||
Restructuring Cost and Reserve | |||
Restructuring costs | 0.6 | ||
Total including discontinued operations | |||
Restructuring Cost and Reserve | |||
Restructuring costs | 66.1 | 40.3 | 56.4 |
Pressure-sensitive Materials | Other expense, net | |||
Restructuring Cost and Reserve | |||
Restructuring costs | 40.2 | 10.8 | 34.1 |
Retail Branding and Information Solutions | Other expense, net | |||
Restructuring Cost and Reserve | |||
Restructuring costs | 21.3 | 28.5 | 17.8 |
Vancive Medical Technologies | |||
Restructuring Cost and Reserve | |||
Restructuring costs | 4.2 | 0.1 | 0.9 |
Corporate | Other expense, net | |||
Restructuring Cost and Reserve | |||
Restructuring costs | $0.40 | $0.90 | $3 |
TAXES_BASED_ON_INCOME_Details
TAXES BASED ON INCOME (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Current: | |||
U.S. federal tax | $14.50 | $1.90 | ($18.70) |
State taxes | -0.2 | 0.3 | -2.4 |
International taxes | 115 | 107.3 | 101.2 |
Total | 129.3 | 109.5 | 80.1 |
Deferred: | |||
U.S. federal tax | -21.4 | -11.2 | 9.5 |
State taxes | 8 | 1.3 | -9.3 |
International taxes | -2.6 | 19.2 | -0.3 |
Total | -16 | 9.3 | -0.1 |
Provision for income taxes | $113.30 | $118.80 | $80 |
TAXES_BASED_ON_INCOME_Details_
TAXES BASED ON INCOME (Details 2) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Taxes Based on Income | |||
Computed tax at 35% of income before taxes | $127.50 | $127.10 | $83.10 |
U.S statutory rate | 35.00% | ||
Increase (decrease) in taxes resulting from: | |||
State taxes, net of federal tax benefit | 1.4 | 2.4 | 1.1 |
Foreign earnings taxed at different rates | -15.9 | -14.7 | 11.8 |
Valuation allowance | 16 | -4.3 | -23.6 |
Corporate owned life insurance | -4.2 | -6.9 | -5.5 |
U.S. federal research and development tax credits | -1.6 | -7 | |
Tax contingencies and audit settlements | -2.7 | 23.1 | 9.4 |
Expiration of carryforward items | 1.4 | 2.5 | 4.8 |
Other items, net | -8.6 | -3.4 | -1.1 |
Provision for income taxes | 113.3 | 118.8 | 80 |
Expense related to accrual of U.S. taxes on certain foreign earnings | $12.10 | $11.20 |
TAXES_BASED_ON_INCOME_Details_1
TAXES BASED ON INCOME (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Taxes Based on Income | |||
U.S. | $3.50 | ($36.20) | ($125.70) |
International | 360.9 | 399.3 | 363.3 |
Income from continuing operations before taxes | $364.40 | $363.10 | $237.60 |
TAXES_BASED_ON_INCOME_Details_2
TAXES BASED ON INCOME (Details 4) (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 | |
Taxes Based on Income | |||
Effective tax rate (as a percent) | 31.10% | 32.70% | 33.70% |
Discrete tax benefits impacting the effective tax rate related to retroactive reinstatement of the federal research and development tax credit | $11,000,000 | ||
Tax expense (benefit) on changes in certain tax reserves and valuation allowances | 18,800,000 | ||
Tax expense (benefit) on changes in certain tax reserves, including interest and penalties, resulting from settlements of audits | -10,200,000 | ||
Tax expense (benefit) on changes in certain tax reserves, including interest and penalties, resulting from lapses and statute expirations | -18,100,000 | ||
Repatriation tax benefit related to certain foreign losses | -9,800,000 | ||
Tax expense from the taxable inclusion of a net foreign currency gain related to revaluation of certain intercompany loans | 9,100,000 | ||
Tax expense related to change in estimate of the potential outcome of uncertain tax issues in China | 10,600,000 | ||
State tax expense primarily related to gains arising as a result of certain foreign reorganizations | 2,500,000 | ||
Net tax benefit from out-of-period adjustments to properly reflect uncertain tax positions, the cumulative tax effect of currency translation associated with a foreign branch investment, the valuation allowance related to state deferred tax assets, and deferred taxes related to acquisitions completed in 2002 and 2003 | -900,000 | ||
Expense for accrual of U.S. taxes on certain foreign earnings expected to be repatriated during 2013 | 12,100,000 | 11,200,000 | |
Benefit from release of a valuation allowance on certain state tax credits | 6,200,000 | ||
Impact on the effective tax rate by the expiration of federal research and development tax credit in prior year | 5,000,000 | ||
Undistributed earnings of foreign subsidiaries considered indefinitely reinvested in foreign operations | 2,200,000,000 | ||
Benefits from favorable tax rates associated with certain earnings from the entity's operations in lower-tax jurisdictions throughout the world | $11,200,000 |
TAXES_BASED_ON_INCOME_Details_3
TAXES BASED ON INCOME (Details 5) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Schedule of components of the temporary differences | ||
Accrued expenses not currently deductible | $40.70 | $44.70 |
Net operating losses | 277.7 | 306.2 |
Tax credit carryforwards before tax effect | 104.2 | 129.2 |
Postretirement and postemployment benefits | 97.6 | 100.8 |
Pension costs | 154 | 95.7 |
Inventory reserves | 9.1 | 8.6 |
Other assets | 9.2 | 6.2 |
Valuation allowance | -75 | -59 |
Total deferred tax assets | 617.5 | 632.4 |
Depreciation and amortization | -121.8 | -127.8 |
Repatriation accrual | 1.9 | -52.9 |
Foreign operating loss recapture | -118 | -136.5 |
Other liabilities | -3 | -1.8 |
Total deferred tax liabilities | -240.9 | -319 |
Total net deferred tax assets from continuing operations | 376.6 | 313.4 |
Contra deferred tax liability related to unrealized foreign exchange losses associated with earnings | 6.3 | |
Net deferred tax liability associated with the future tax cost to repatriate non permanently reinvested earnings of the Company's foreign subsidiaries | $4.40 |
TAXES_BASED_ON_INCOME_Details_4
TAXES BASED ON INCOME (Details 7) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | $928.70 | $1,060 |
Tax credit carryforwards before tax effect | 104.2 | 129.2 |
Net operating loss and credit carryforward | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 104.2 | 129.2 |
Expires in 2015 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 15.3 | |
Expires in 2016 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 8.1 | |
Expires in 2017 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 15.5 | |
Expires in 2018 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 16.5 | |
Expires in 2019 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 4.6 | |
Expires in 2020 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 17.7 | |
Expires in 2021 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 8.2 | |
Expires in 2022 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 2.8 | |
Expires in 2023 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 13.7 | |
Expires in 2024 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 3.3 | |
Expires in 2029 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 1.8 | |
Expires in 2030 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 0.4 | |
Expires in 2031 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 0.6 | |
Expires in 2032 | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 1.1 | |
Indefinite life/no expiration Member | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | 819.1 | |
Expires in 2015 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.6 | |
Expires in 2016 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.7 | |
Expires in 2017 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.4 | |
Expires in 2018 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 23.9 | |
Expires in 2019 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 33.2 | |
Expires in 2020 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 15.9 | |
Expires in 2021 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.3 | |
Expires in 2022 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 9.6 | |
Expires in 2023 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 5.2 | |
Expires in 2024 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.3 | |
Expires in 2025 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.1 | |
Expires in 2026 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 1.2 | |
Expires in 2027 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.1 | |
Expires in 2028 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.1 | |
Expires in 2029 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 0.1 | |
Expires in 2033 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 1.8 | |
Expires in 2034 | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 1.6 | |
Indefinite/no expiration | Indefinite life/no expiration Member | ||
Net operating loss and tax carryforwards | ||
Tax credit carryforwards before tax effect | 9.1 | |
Foreign subsidiaries | ||
Net operating loss and tax carryforwards | ||
Net operating loss carryforwards of foreign subsidiaries | $928.70 | $1,060 |
Expected period for certain indefinite-lived foreign net operating losses to be fully utilized | 50 years |
TAXES_BASED_ON_INCOME_Details_5
TAXES BASED ON INCOME (Details 8) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Taxes Based on Income | |||
Unrecognized tax benefits | $122.60 | $137.20 | $121.60 |
Unrecognized tax benefits, if recognized, would reduce annual effective income tax rate | 98.7 | 96.7 | |
Interest expense and penalties recognized in current year for uncertain tax positions | -1.3 | 2.7 | 5.5 |
Accrued interest and penalties for uncertain tax positions, net of tax benefit | $26.70 | $29.20 |
TAXES_BASED_ON_INCOME_Details_6
TAXES BASED ON INCOME (Details 9) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | ||
Balance at beginning of year | $137.20 | $121.60 |
Additions based on tax positions related to the current year | 18.2 | 20.1 |
Additions for tax position of prior years | 7.8 | 8.3 |
Reduction for tax positions of prior years: | ||
Changes in judgment | -1.8 | -4 |
Benefit from the effective settlement of uncertain tax positions | -15.8 | -2.6 |
Lapses and statute expirations | -13.8 | -6.2 |
Changes due to translation of foreign currencies | -9.2 | |
Balance at end of year | 122.6 | 137.2 |
Reasonably possible decrease in unrecognized tax benefits during next 12 months | ($12) |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Segment Reporting Information | |||||||||||
Net sales | $1,604.80 | $1,559.60 | $1,615.80 | $1,550.10 | $1,583.90 | $1,504.90 | $1,552.30 | $1,498.90 | $6,330.30 | $6,140 | $5,863.50 |
Interest expense | -63.3 | -59 | -72.9 | ||||||||
Income from continuing operations before taxes | 364.4 | 363.1 | 237.6 | ||||||||
Other expense, net | 14.6 | 7.8 | 38.5 | 7.3 | 3.7 | 25.7 | -0.3 | 7.5 | 68.2 | 36.6 | 68.8 |
Capital expenditures | 152.2 | 124.7 | 92.9 | ||||||||
Depreciation and amortization expense | 201.6 | 204.3 | 211 | ||||||||
Intersegment | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 75.2 | 70.6 | 65.5 | ||||||||
Pressure-sensitive Materials | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 4,658.10 | 4,455 | 4,257.60 | ||||||||
Income from continuing operations before taxes | 434.4 | 442.8 | 359.7 | ||||||||
Other expense, net | 41.6 | 10.8 | 33.5 | ||||||||
Capital expenditures | 110.5 | 81.1 | 64.8 | ||||||||
Depreciation and amortization expense | 116 | 113.5 | 112.8 | ||||||||
Pressure-sensitive Materials | Intersegment | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 63.2 | 64.6 | 60.9 | ||||||||
Pressure-sensitive Materials | Materials | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 4,330 | 4,160 | 3,980 | ||||||||
Pressure-sensitive Materials | Performance Tapes | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 332.5 | 293 | 274.2 | ||||||||
Retail Branding and Information Solutions | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 1,591.60 | 1,611.10 | 1,535 | ||||||||
Income from continuing operations before taxes | 87.9 | 81.7 | 53.3 | ||||||||
Other expense, net | 22 | 20 | 24.8 | ||||||||
Capital expenditures | 39.6 | 42.4 | 24.7 | ||||||||
Depreciation and amortization expense | 81.4 | 86.7 | 93.9 | ||||||||
Retail Branding and Information Solutions | Intersegment | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 2.4 | 2.4 | 3.8 | ||||||||
Vancive Medical Technologies | Operating segments | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 80.6 | 73.9 | 70.9 | ||||||||
Income from continuing operations before taxes | -11.7 | -8.3 | -16.2 | ||||||||
Other expense, net | 4.2 | 0.1 | 4.8 | ||||||||
Capital expenditures | 2.1 | 1.2 | 3.4 | ||||||||
Depreciation and amortization expense | 4.2 | 4.1 | 4.3 | ||||||||
Vancive Medical Technologies | Intersegment | |||||||||||
Segment Reporting Information | |||||||||||
Net sales | 9.6 | 3.6 | 0.8 | ||||||||
Corporate | |||||||||||
Segment Reporting Information | |||||||||||
Income from continuing operations before taxes | -82.9 | -94.1 | -86.3 | ||||||||
Other expense, net | $0.40 | $5.70 | $5.70 |
SEGMENT_INFORMATION_Details_2
SEGMENT INFORMATION (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Other items: | |||||||||||
Charitable contribution to Avery Dennison Foundation | $10 | $10 | |||||||||
Indefinite-lived intangible asset impairment charge | 3 | 3 | 7 | ||||||||
Gains on sale of product line | -0.6 | ||||||||||
Gains on sales of assets | -1.9 | -0.6 | -5.1 | -0.5 | -10.9 | -1.3 | -2.5 | -17.8 | |||
Losses from curtailment and settlement of pension obligations | 1 | 0.6 | -1.6 | 1.6 | -1.6 | ||||||
Legal settlement | 0 | 2.5 | 2.5 | ||||||||
Product line exits | 3.9 | ||||||||||
Divestiture-related costs (1) | 1.1 | 1.1 | 0.3 | 0.7 | 3.2 | 2.7 | |||||
Other expense, net | 14.6 | 7.8 | 38.5 | 7.3 | 3.7 | 25.7 | -0.3 | 7.5 | 68.2 | 36.6 | 68.8 |
Severance and related costs | |||||||||||
Restructuring costs | |||||||||||
Asset impairment charges and lease and other contract cancellation costs | 6.7 | 5.1 | 35.9 | 7 | 6.3 | 8.7 | 5.4 | 6.8 | 54.7 | 27.2 | 49.3 |
Asset impairment charges and lease contract cancellation costs | |||||||||||
Restructuring costs | |||||||||||
Asset impairment charges and lease and other contract cancellation costs | $6.90 | $1.60 | $2.60 | $0.30 | $1.40 | $8 | $2.40 | $1.30 | $11.40 | $13.10 | $6.50 |
SEGMENT_INFORMATION_Details_3
SEGMENT INFORMATION (Details 3) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | $1,604.80 | $1,559.60 | $1,615.80 | $1,550.10 | $1,583.90 | $1,504.90 | $1,552.30 | $1,498.90 | $6,330.30 | $6,140 | $5,863.50 |
Property, plant and equipment, net | |||||||||||
Property, plant and equipment, net | 875.3 | 922.5 | 875.3 | 922.5 | 1,015.50 | ||||||
U.S. | |||||||||||
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | 1,529.40 | 1,537.60 | 1,528.30 | ||||||||
Property, plant and equipment, net | |||||||||||
Property, plant and equipment, net | 261.5 | 279.6 | 261.5 | 279.6 | 340.2 | ||||||
Europe | |||||||||||
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | 2,074.40 | 1,958.40 | 1,851.10 | ||||||||
Asia | |||||||||||
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | 1,914.20 | 1,823.50 | 1,627.60 | ||||||||
Latin America | |||||||||||
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | 522.9 | 515.6 | 501.2 | ||||||||
Other International | |||||||||||
Net sales to unaffiliated customers | |||||||||||
Revenue, Net, Total | 289.4 | 304.9 | 355.3 | ||||||||
International | |||||||||||
Property, plant and equipment, net | |||||||||||
Property, plant and equipment, net | $613.80 | $642.90 | $613.80 | $642.90 | $675.30 |
SUPPLEMENTARY_FINANCIAL_INFORM
SUPPLEMENTARY FINANCIAL INFORMATION (Details) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Inventories | ||
Raw materials | $183.60 | $196.30 |
Work-in-progress | 150.4 | 149 |
Finished goods | 157.8 | 148.8 |
Inventories, net | $491.80 | $494.10 |
SUPPLEMENTAL_FINANCIAL_INFORMA2
SUPPLEMENTAL FINANCIAL INFORMATION (Details 2) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
In Millions, unless otherwise specified | |||
Property, Plant and Equipment | |||
Property, plant and equipment | $2,654.50 | $2,702.80 | |
Accumulated depreciation | -1,779.20 | -1,780.30 | |
Property, plant and equipment, net | 875.3 | 922.5 | 1,015.50 |
Land | |||
Property, Plant and Equipment | |||
Property, plant and equipment | 32.1 | 47 | |
Buildings and improvements | |||
Property, Plant and Equipment | |||
Property, plant and equipment | 578.2 | 580.2 | |
Machinery and equipment | |||
Property, Plant and Equipment | |||
Property, plant and equipment | 1,958.20 | 2,001.30 | |
Construction-in-progress | |||
Property, Plant and Equipment | |||
Property, plant and equipment | $86 | $74.30 |
SUPPLEMENTAL_FINANCIAL_INFORMA3
SUPPLEMENTAL FINANCIAL INFORMATION (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Research and Development Expense [Abstract] | |||
Research and Development Expense | $102.50 | $96 | $98.60 |
Total software | |||
Capitalized software costs | |||
Software amortization expense from continuing operations | 36.4 | 35.3 | 30.7 |
Total software | Other assets | |||
Capitalized software costs | |||
Cost | 445.7 | 427.9 | |
Accumulated Amortization | -293.1 | -264.6 | |
Software, net | $152.60 | $163.30 |
SUPPLEMENTAL_FINANCIAL_INFORMA4
SUPPLEMENTAL FINANCIAL INFORMATION (Details 4) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Cash paid for interest and income taxes | |||
Interest, net of capitalized amounts | $61.60 | $64.10 | $68 |
Income taxes, net of refunds | 108.8 | 129.4 | 97.7 |
Capital expenditure accrued but not paid | 3.8 | 11.5 | 12 |
Foreign Currency | |||
Foreign currency translation adjustment | $8.70 | $7.90 | $8.80 |
QUARTERLY_FINANCIAL_INFORMATIO2
QUARTERLY FINANCIAL INFORMATION (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
QUARTERLY FINANCIAL INFORMATION (Unaudited) | |||||||||||
Net sales | $1,604.80 | $1,559.60 | $1,615.80 | $1,550.10 | $1,583.90 | $1,504.90 | $1,552.30 | $1,498.90 | $6,330.30 | $6,140 | $5,863.50 |
Gross profit | 415.1 | 400.7 | 428.2 | 407.2 | 416.3 | 402.2 | 417.5 | 401.7 | 1,651.20 | 1,637.70 | 1,528.20 |
Income from continuing operations | 70.1 | 65 | 44.4 | 71.6 | 44.7 | 62 | 70.8 | 66.8 | 251.1 | 244.3 | 157.6 |
(Loss) income from discontinued operations, net of tax | 0.8 | -0.7 | -1.9 | -0.4 | -2 | -15.5 | -2 | -9 | |||
Net income | $70.90 | $64.30 | $42.50 | $71.20 | $42.70 | $46.50 | $68.80 | $57.80 | $248.90 | $215.80 | $215.40 |
Net income (loss) per common share: | |||||||||||
Continuing operations (in dollars per share) | $0.77 | $0.70 | $0.47 | $0.74 | $0.46 | $0.63 | $0.71 | $0.67 | $2.68 | $2.48 | $1.54 |
Discontinued operations (in dollars per share) | $0.01 | ($0.01) | ($0.02) | ($0.02) | ($0.16) | ($0.02) | ($0.09) | ($0.03) | ($0.29) | $0.56 | |
Net income per common share (in dollars per share) | $0.78 | $0.69 | $0.45 | $0.74 | $0.44 | $0.47 | $0.69 | $0.58 | $2.65 | $2.19 | $2.10 |
Net income (loss) per common share, assuming dilution: | |||||||||||
Continuing operations (in dollars per share) | $0.75 | $0.68 | $0.46 | $0.73 | $0.45 | $0.62 | $0.70 | $0.66 | $2.62 | $2.44 | $1.52 |
Discontinued operations (in dollars per share) | $0.01 | ($0.02) | ($0.02) | ($0.15) | ($0.02) | ($0.09) | ($0.02) | ($0.28) | $0.56 | ||
Net income per common share, assuming dilution (in dollars per share) | $0.76 | $0.68 | $0.44 | $0.73 | $0.43 | $0.47 | $0.68 | $0.57 | $2.60 | $2.16 | $2.08 |
QUARTERLY_FINANCIAL_INFORMATIO3
QUARTERLY FINANCIAL INFORMATION (Unaudited) (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Jan. 03, 2015 | Sep. 27, 2014 | Jun. 28, 2014 | Mar. 29, 2014 | Dec. 28, 2013 | Sep. 28, 2013 | Jun. 29, 2013 | Mar. 30, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Other items: | |||||||||||
Indefinite-lived intangible asset impairment charge | $3 | $3 | $7 | ||||||||
Gains on sales of assets | -1.9 | -0.6 | -5.1 | -0.5 | -10.9 | -1.3 | -2.5 | -17.8 | |||
Losses from curtailment and settlement of pension obligations | 1 | 0.6 | -1.6 | 1.6 | -1.6 | ||||||
Legal settlement | 0 | 2.5 | 2.5 | ||||||||
Divestiture-related costs (1) | 1.1 | 1.1 | 0.3 | 0.7 | 3.2 | 2.7 | |||||
Charitable contribution to Avery Dennison Foundation | 10 | 10 | |||||||||
Product line exits | 3.9 | ||||||||||
Other Expense Net | 14.6 | 7.8 | 38.5 | 7.3 | 3.7 | 25.7 | -0.3 | 7.5 | 68.2 | 36.6 | 68.8 |
Severance and related costs | |||||||||||
Restructuring Cost and Reserve | |||||||||||
Asset impairment charges and lease and other contract cancellation costs | 6.7 | 5.1 | 35.9 | 7 | 6.3 | 8.7 | 5.4 | 6.8 | 54.7 | 27.2 | 49.3 |
Asset impairment charges and lease contract cancellation costs | |||||||||||
Restructuring Cost and Reserve | |||||||||||
Asset impairment charges and lease and other contract cancellation costs | $6.90 | $1.60 | $2.60 | $0.30 | $1.40 | $8 | $2.40 | $1.30 | $11.40 | $13.10 | $6.50 |
SCHEDULE_IIVALUATION_AND_QUALI1
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
Allowance for doubtful accounts | |||
Valuation and qualifying accounts and reserves | |||
Balance at Beginning of Year | $21.40 | $31.10 | $34 |
Net Additions Charged to Costs and Expenses | 6.3 | 5.1 | 3.4 |
Deductions from Reserves | -6.9 | -14.8 | -6.3 |
Balance at End of Year | 20.8 | 21.4 | 31.1 |
Allowance for sales returns | |||
Valuation and qualifying accounts and reserves | |||
Balance at Beginning of Year | 10.2 | 13.7 | 9.3 |
Net Additions Charged to Costs and Expenses | 14.4 | 11.2 | 14.5 |
Deductions from Reserves | -14.9 | -14.7 | -10.1 |
Balance at End of Year | $9.70 | $10.20 | $13.70 |